1

REPUBLIC ACT No. 10963 Section 3. Section 5 of the National Internal Revenue Code of 1997
(NIRC), as amended, is hereby further amended to read as follows:
An Act Amending Sections 5, 6, 24, 25, 27, 31, 32, 33, 34, 51, 52, 56, 57,
58, 74, 79, 84, 86, 90, 91, 97, 99, 100, 101, 106, 107, 108, 109, 110, 112, "Sec. 5. Power of the Commissioner to Obtain Information, and to
114, 116, 127, 128, 129, 145, 148, 149, 151, 155, 171, 174, 175, 177, 178, Summon, Examine, and Take Testimony of Persons. - In ascertaining the
179, 180, 181, 182, 183, 186, 188, 189, 190, 191, 192, 193, 194, 195, 196, correctness of any return, or in making a return when none has been
197, 232, 236, 237, 249, 254, 264, 269, and 288; Creating New Sections made, or in determining the liability of any person for any internal
51-A, 148-A, 150-A, 150-B, 237-A, 264-A, 264-B, and 265-A; and revenue tax, or in collecting any such liability, or in evaluating tax
Repealing Sections 35, 62, And 89; All Under Republic Act No. 8424, compliance, the Commissioner is authorized:
Otherwise Known as the National Internal Revenue Code of 1997, as
Amended, and for Other Purposes "(A) x x x

Be it enacted by the Senate and House of Representatives of the "(B) To obtain on a regular basis from any person other
Philippine Congress Assembled: than the person whose internal revenue tax liability is
subject to audit or investigation, or from any office or
Section 1. Title. - This Act shall be known as the "Tax Reform for officer of the national and local governments,
Acceleration and Inclusion (TRAIN)". government agencies and instrumentalities, including
the Bangko Sentral ng Pilipinas and government-owned
Section 2. Declaration of Policy. - It is hereby declared the policy of the or -controlled corporations, any information such as,
State: but not limited to, costs and volume of production,
receipts or sales and gross incomes of taxpayers, and
(a) To enhance the progressivity of the tax system through the the names, addresses, and financial statements of
rationalization of the Philippine internal revenue tax system, corporations, mutual fund companies, insurance
thereby promoting sustainable and inclusive economic growth; companies, regional operating headquarters of
multinational companies, joint accounts, associations,
(b) To provide, as much as possible, an equitable relief to a joint ventures or consortia and registered partnerships,
greater number of taxpayers and their families in order to and their members: Provided, That the Cooperative
improve levels of disposable income and increase economic Development Authority shall submit to the Bureau a
activity; and tax incentive report, which shall include information on
the income tax, value-added tax, and other tax
(c) To ensure that the government is able to provide for the incentives availed of by cooperatives registered and
needs of those under its jurisdiction and care through the enjoying incentives under Republic Act No. 6938, as
provision of better infrastructure, health, education, jobs, and amended: Provided, further, That the information
social protection for the people. submitted by the Cooperative Development Authority
to the Bureau shall be submitted to the Department of
Finance and shall be included in the database created
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under Republic Act No. 10708, otherwise known as mandatory consultation with competent appraisers both from
‘The Tax Incentives Management and Transparency Act the private and public sectors, and with prior notice to affected
(TIMTA)’. taxpayers, determine the fair market value af real properties
located in each zone or area, subject to automatic adjustment
"x x x." once every three (3) years through rules and regulations issued
by the Secretary of Finance based on the current Philippine
Section 4. Section 6 of the NIRC, as amended, is hereby further valuation standards: Provided, That no adjustment in zonal
amended to read as follows: valuation shall be valid unless published in a newspaper of
general circulation in the province, city or municipality
"Sec. 6. Power of the Commissioner to Make Assessments and Prescribe concerned, or in the absence thereof, shall be posted in the
Additional Requirements for Tax Administration and Enforcement - provincial capitol, city or municipal hall and in two (2) other
conspicuous public places therein: Provided, further, That the
"(A) Examination of Returns and Determination of Tax Due.— basis of any valuation, including the records of consultations
After a return has been filed as required under the provisions of done, shall be public records open to the inquiry of any
this Code, the Commissioner or his duly authorized taxpayer. For purposes of computing any internal revenue tax,
representative may authorize the examination of any taxpayer the value of the property shall be, whichever is the higher of:
and the assessment of the correct amount of tax,
notwithstanding any law requiring the prior authorization of "(1) the fair market value as determined by the
any government agency or instrumentality: Provided, however, Commissioner; or
That failure to file a return shall not prevent the Commissioner
from authorizing the examination of any taxpayer. "(2) the fair market value as shown in the schedule of
values of the Provincial and City Assessors."
"x x x
Section 5. Section 24 of the NIRC, as amended, is hereby further
"x x x amended to read as follows:

"(B) x x x "Sec. 24. Income Tax Rates. -

"(C) x x x "(A) Rates of Income Tax on Individual Citizen and Individual, Resident
Alien of the Philippines -
"(D) x x x
"(1) An income tax is hereby imposed:
"(E) Authority of the Commissioner to Prescribe Real Property
Values.— The Commissioner is hereby -authorized to divide the "(a) On the taxable income defined in Section 31 of this
Philippines into different zones or areas and shall, upon Code, other than income subject to tax under
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Subsections (B), (C), and (D) of this Section, derived for "Over ₱800,000 but not over ₱130,000 + 30% of the excess
each taxable year from all sources within and without ₱2,000,000 over ₱800,000
the Philippines by every individual citizen of the
Philippines residing therein; "Over ₱2,000,000 but not ₱490,000 + 32% of the excess
over ₱5,000,000 over ₱2,000,000
"(b) On the taxable income defined in Section 31 of this
Code, other than income subject to tax under "Over ₱8,000,000 ₱2,410,000 + 35% of the
Subsections (B), (C), and (D) of this Section, derived for excess over ₱8,000,000
each taxable year from all sources within the
Philippines by an individual citizen of the Philippines "Tax Schedule Effective January 1, 2023 and onwards:
who is residing outside of the Philippines including
overseas contract workers referred to in Subsection (C)
"Not over ₱250,000 0%
of Section 23 hereof; and
"Over ₱250,000 but not over 15% of the excess over ₱250,000
"(c) On the taxable income defined in Section 31 of this ₱400,000
Code, other than income subject to tax under
Subsections (B), (C), and (D) of this Section, derived for "Over ₱400,000 but not over ₱22,500 + 20% of the excess over
each taxable year from all sources within the ₱800,000 ₱400,000
Philippines by an individual alien who is a resident of
"Over ₱800,000 but not over ₱102,500 + 25% of the excess over
the Philippines.
₱2,000,000 ₱800,000

"(2) Rates of Tax on Taxable Income of Individuals. - The tax "Over ₱2,000,000 but not over ₱402,500 + 30% of the excess over
shall be computed in accordance with and at the rates ₱8,000,000 ₱2,000,000
established in the following schedule:
"Over ₱8,000,000 ₱2,202,500 + 35% of the excess over
₱8,000,000
"(a) Tax Schedule Effective January 1, 2018 until
December 31, 2022:
"For married individuals, the husband and wife, subject to the
provision of Section 51(D) hereof, shall compute separately
"Not over ₱250,000 0%
their individual income tax based on their respective total
"Over ₱250,000 but not over 20% of the excess over taxable income: Provided, That if any income cannot be
₱400,000 ₱250,000 definitely attributed to or identified as income exclusively
earned or realized by either of the spouses, the same shall be
"Over ₱400,000 but not over ₱30,000 + 25% of the excess divided equally between the spouses for the purpose of
₱800,000 over ₱400,000 determining their respective taxable income.
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"Provided, That minimum wage earners as defined in Section prescribed under Subsection (A)(2)(a)
22(HH) of this Code shall be exempt from the payment of of this Section on taxable income, or
income tax on their taxable income: Provided, further, That the eight percent (8%) income tax based
holiday pay, pay received by such minimum wage earners shall on gross sales or gross receipts and
likewise be exempt from income tax. other non-operating income in lieu of
the graduated income tax rates under
"(b) Rate of Tax on Income of "Purely Self-employed Subsection (A)(2)(a) of this Section
Individuals and/ or Professionals Whose Gross Sales or and the percentage tax under Section
Gross Receipts and Other Non-operating Income Does 116 of this Code.
Not Exceed the Value-added Tax (VAT) Threshold as
Provided in Section 109(BB).— Self-employed "(b) If Total Gross Sales and/or Gross
individuals and/or professionals shall have the option Receipts and Other Non-operating
to avail of an eight percent (8%) tax on gross sales or Income Exceeds the VAT Threshold as
gross receipts and other non-operating income in Provided in Section 109(BB) of this
excess of Two hundred fifty thousand pesos (₱250,000) Code.— The rates prescribed under
in lieu of the graduated income tax rates under Subsection (A)(2)(a) of this Section.
Subsection (A)(2)(a) of this Section and the percentage
tax under Section 116 of this Code. "(B) Rate of Tax on Certain Passive Income.—

"(c) Rate of Tax for Mixed Income Earners.— Taxpayers "(1) Interests, Royalties, Prizes, and Other Winnings.—
earning both compensation income and income from A final tax at the rate of twenty percent (20%) is hereby
business or practice of profession shall be subject to imposed upon the amount of interest from any
the following taxes: currency bank deposit and yield or any other monetary
benefit from deposit substitutes and from trust funds
"(1) All Income from Compensation – The and. similar arrangements; royalties, except on books,
rates prescribed under Subsection (A)(2)(a) of as well as other literary works and musical
this Section. compositions, which shall be imposed a final tax of ten
percent (10%); prizes (except prizes amounting to Ten
"(2) All Income from Business or Practice of thousand pesos (₱10,000) or less which shall be
Profession – subject to tax under Subsection (A) of Section 24; and
other winnings (except winnings amounting to Ten
"(a) If Total Gross Sales and/or Gross thousand pesos (₱10,000) or less from Philippine
Receipts and Other Non-operating Charity Sweepstakes and Lotto which shall be exempt),
Income Do Not Exceed the VAT derived from sources within the
Threshold as Provided in Section Philippines: Provided, however, That interest income
109(BB) of this Code.— The rates received by an individual taxpayer (except a
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nonresident individual) from a depository bank under "(C) Capital Gains from Sale of Shares of Stock not Traded in the Stock
the expanded foreign currency deposit system shall be Exchange. - The provisions of Section 39(B) notwithstanding, a final tax
subject to a final income tax at the rate of fifteen at the rate of fifteen percent (15%) is hereby imposed upon the net
percent (15%) of such interest income: Provided, capital gains realized during the taxable year from the sale, barter,
further, That interest income from long-term deposit exchange or other disposition of shares of stock in a domestic
or investment in the form of savings, common or corporation, except shares sold, or disposed of through the stock
individual trust funds, deposit substitutes, investment exchange.
management accounts and other investments
evidenced by certificates in such form prescribed by "x x x."
the Bangko Sentral ng Pilipinas (BSP) shall be exempt
from the tax imposed under this Subsection: Provided, Section 6. Section 25 of the NIRC, as amended, is hereby further
finally, That should the holder of the certificate pre- am.ended to read as follows:
terminate the deposit or investment before the fifth
(5th) year, a final tax shall be imposed on the entire "Sec. 25. Tax on Nonresident Alien Individual -
income and shall be deducted and withheld by the
depository bank from the proceeds of the long-term "(A) Nonresident Alien Engaged in Trade or Business Within the
deposit or investment certificate based on the Philippines. - "x x x
remaining maturity thereof:
"(B) Nonresident Alien Individual Not Engaged in Trade or
"x x x." Business Within the Philippines. - "x x x

"(2) Cash and/or Property Dividends. - A final tax at the "(C) Alien Individual Employed by Regional or Area Headquarters
rate of ten percent (10%) shall be imposed upon the and Regional Operating Headquarters of Multinational
cash and/or property dividends actually or Companies. - There shall be levied, collected and paid for each
constructively received by an individual from a taxable year upon the gross income received by every alien
domestic corporation or from a joint stock company, individual employed by regional or area headquarters and
insurance or mutual fund companies and regional regional operating headquarters established in the Philippines
operating headquarters of multinational companies, or by multinational companies as salaries, wages, annuities,
on the share of an individual in the distributable net compensation, remuneration and other emoluments, such as
income after tax of a partnership (except a general honoraria and allowances, from such regional or area
professional partnership) of which he is a partner, or headquarters and regional operating headquarters, a tax equal
on the share of an individual in the net income after to fifteen percent (15%) of such gross
tax of an association, a joint account, or a joint venture income: Provided, however, That the same tax treatment shall
or consortium taxable as a corporation of which he is a apply to Filipinos employed and occupying the same position as
member or co-venturer. those of aliens employed by these multinational companies. For
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purposes of this Chapter, the term ‘multinational company’ "Any income earned from all other sources within the
means a foreign firm or entity engaged in international trade Philippines by the alien employees referred to under
with affiliates or subsidiaries or branch offices in the Asia-Pacific Subsections (C), (D), and (E) hereof shall be subject to
Region and other foreign markets. the pertinent income tax, as the case may be, imposed
under this Code.
"(D) Alien Individual Employed by Offshore Banking
Units. - There shall be levied, collected and paid for "(F) The preferential tax treatment provided in
each taxable year upon the gross income received by Subsections (C), (D), and (E) of this Section shall not be
every alien individual employed by offshore banking applicable to regional headquarters (RHQs), regional
units established in the Philippines as salaries, wages, operating headquarters (ROHQs), offshore banking
annuities, compensation, remuneration and other units (OBUs) or petroleum service contractors and
emoluments such as honoraria and allowances, from subcontractors registering with the Securities and
such offshore banking units, a tax equal to fifteen Exchange Commission (SEC) after January 1,
percent (15%) of such gross 2018: Provided, however, That existing RHQs/ROHQs,
income: Provided, however, That the same tax OBUs or petroleum service contractors and
treatment shall apply to Filipinos employed and subcontractors presently availing of preferential tax
occupying the same position as those of aliens rates for qualified employees shall continue to be
employed by these offshore banking units. entitled to avail of the preferential tax rate for present
and future qualified employees."
"(E) Alien Individual Employed by Petroleum Service
Contractor and Subcontractor. - An alien individual who Section 7. Section 27 of the NIRC, as amended, is hereby further
is a permanent resident of a foreign country but who is amended to read as follows:
employed and assigned in the Philippines by a foreign
service contractor or by a foreign service subcontractor "Sec. 27. Rates of Income Tax on Domestic Corporations -
engaged in petroleum operations in the Philippines
shall be liable to a tax of fifteen percent (15%) of the "(A) In General.— x x x
salaries, wages, annuities, compensation,
remuneration and other emoluments, such as "x x x
honoraria and allowances, received from such
contractor or subcontractor: Provided, however, That "(C) Government-owned or -Controlled Corporations,
the same tax treatment shall apply to a Filipino Agencies or Instrumentalities - The provisions of
employed and occupying the same position as an alien existing special or general laws to the contrary
employed by petroleum service contractor and notwithstanding, all corporations, agencies, or
subcontractor. instrumentalities owned or controlled by the
Government, except the Government Service
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Insurance System (GSIS), the Social Security System "x x x"

(SSS), the Philippine Health Insurance Corporation
(PHIC), and the local water districts shall pay such rate Section 8. Section 31 of the NIRC, as amended, is hereby further
of tax upon their taxable income as are imposed by this amended to read as follows:
Section upon corporations or associations engaged in
similar business, industry, or activity. "Sec. 31. Taxable Income Defined. - The term ‘taxable income’ means
the pertinent items of gross income specified in this Code, less
"(D) Rates of Tax on Certain Passive Incomes - deductions, if any, authorized for such types of income by this Code or
other special laws."
"(1) Interest from Deposits and Yield or any
other Monetary Benefit from Deposit Section 9. Section 32 of the NIRC, as amended, is hereby further
Substitutes and from Trust Funds and Similar amended to read as follows:
Arrangements, and Royalties. - A final tax at
the rate of twenty percent (20%) is hereby "Sec. 32. Gross Income -
imposed upon the amount of interest on
currency bank deposit and yield or any other "(A) General Definition - x x x
monetary benefit from deposit substitutes and
from trust funds and similar arrangements "(B) Exclusions from Gross Income. - x x x
received by domestic corporations, and
royalties, derived from sources within the
"(1) x x x
Philippines: Provided, however, That interest
income derived by a domestic corporation
"(7) Miscellaneous Items -
from a depository bank under the expanded
foreign currency deposit system shall be
subject to a final income tax at the rate of "(a) x x x
fifteen percent (15%) of such interest income.
"(e) 13th Month Pay and Other Benefits. -
"(2) Capital Gains from the Sale of Shares of Gross benefits received by officials and
Stock Not Traded in the Stock Exchange. - A employees of public and private
final tax at the rate of fifteen percent (15%) entities: Provided, however, That the total
shall be imposed on net capital gains realized exclusion under this subparagraph shall not
during the taxable year from the sale, exceed Ninety thousand pesos (₱90,000)
exchange or other disposition of shares of which shall cover:
stock in a domestic corporation except shares
sold or disposed of through the stock "(i) Benefits received by officials and
exchange. employees of the national and local
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government pursuant to Republic Act Section 57(A) of this Code. The grossed-up monetary
No. 6686; value of the fringe benefit shall be determined by
dividing the actual monetary value of the fringe benefit
"(ii) Benefits received by employees by sixty five percent (65%) effective January 1, 2018
pursuant to Presidential Decree No. and onwards: Provided, however, That fringe benefit
851, as amended by Memorandum furnished to employees and taxable under Subsections
Order No. 28, dated August 13, 1986; (B), (C), (D), and (E) of Section 25 shall be taxed at the
applicable rates imposed thereat: Provided,
"(iii) Benefits received by officials and further, That the grossed-up value of the fringe benefit
employees not covered by shall be determined by dividing the actual monetary
Presidential Decree No. 851, as value of the fringe benefit by the difference between
amended by Memorandum Order No. one hundred percent (100%) and the applicable rates
28, dated August 13,1986; and of income tax under Subsections (B), (C), (D), and (E) of
Section 25.
"(iv) Other benefits such as
productivity incentives and Christmas "x x x."
bonus."
Section 11. Section 34 of the NIRC, as amended, is hereby further
Section 10. Section 33 of the NIRC, as amended, is hereby further amended to read as follows:
amended to read as follows:
"Sec. 34. Deductions from Gross Income. - Except for taxpayers earning
"Sec. 33. Special Treatment of Fringe Benefit. - compensation income arising from personal services rendered under an
employer-employee relationship where no deductions shall be allowed
(a) Imposition of Tax. - Effective January 1, 2018 and under this Section, in computing taxable income subject to income tax
onwards, a final tax of thirty-five percent (35%) is under Sections 24(A); 25(A); 26; 27(A), (B), and (C); and 28(A)(1), there
hereby imposed on the grossed-up monetary value of shall be allowed the following deductions from gross income:
fringe benefit furnished or granted to the employee
(except rank and file employees as defined herein) by "(A) Expenses.—
the employer, whether an individual or a corporation
(unless the fringe benefit is required by the nature of, "(1) Ordinary and Necessary Trade, Business or
or necessary to the trade, business or profession of the Professional Expenses -
employer, or when the fringe benefit is for the
convenience or advantage of the employer). The tax "(a) In General - x x x
herein imposed is payable by the employer which tax
shall be paid in the same manner as provided for under "x x x
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"(L) Optional Standard Deduction (OSD) - In lieu of the Section 12. Section 35 of the NIRC, as amended, is hereby repealed.
deductions allowed under the preceding Subsections,
an individual subject to tax under Section 24, other Section 13. Section 51 of the NIRC, as amended, is hereby further
than a nonresident alien, may elect a standard amended to read as follows:
deduction in an amount not exceeding forty percent
(40%) of his gross sales or gross receipts, as the case "Sec. 51. Individual Returns -
may be. In the case of a corporation subject to tax
under Sections 27(A) and 28(A)(l), it may elect a "(A) x x x
standard deduction in an amount not exceeding forty
percent (40%) of its gross income as defined in Section "(1) x x x
32 of this Code. Unless the taxpayer signifies in his
return his intention to elect the optional standard
"x x x
deduction, he shall be considered as having availed
himself of the deductions allowed in the preceding
"(2) The following individuals shall not be required to
Subsections. Such election when made in the return
file an income tax return:
shall be irrevocable for the taxable year for which the
return is made: Provided, That an individual who is
entitled to and claimed for the optional standard "(a) An individual whose taxable income does
deduction shall not be required to submit with his tax not exceed Two hundred fifty thousand pesos
return such financial statements otherwise required (₱250,000) under Section
under this Code: Provided, further, That a general 24(A)(2)(a): Provided, That a citizen of the
professional partnership and the partners comprising Philippines and any alien individual engaged in
such partnership may avail of the optional standard business or practice of profession within the
deduction only once, either by the general professional Philippines shall file an income tax return,
partnership or the partners comprising the regardless of the amount of gross income;
partnership: Provided, finally, That except when the
Commissioner otherwise permits, the said individual "x x x
shall keep such records pertaining to his gross sales or
gross receipts, the said corporation shall keep such "(5) The income tax return (ITR) shall consist of
records pertaining to his gross income as defined in a maximum of four (4) pages in paper form or
Section 32 of this Code during the taxable year, as may electronic form, and shall only contain the
be required by the rules and regulations promulgated following information:
by the Secretary of Finance, upon recommendation of
the Commissioner. "(A) Personal profile and information;

"Notwithstanding the provisions of the preceding Subsections, x x x."

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"(B) Total gross sales, receipts or "(A) Requirements. - Every corporation subject to the tax herein
income from compensation for imposed, except foreign corporations not engaged in trade or business
services rendered, conduct of trade or in the Philippines, shall render, in duplicate, a true and accurate
business or the exercise of a quarterly income tax return and final or adjustment return in
profession, except income subject to accordance with the provisions of Chapter XII of this Title. The income
final tax as provided under this Code; tax return shall consist of a maximum of four (4) pages in paper form or
electronic form, be filed by the president, vice president or other
"(C) Allowable deductions under this principal officer, shall be sworn to by such officer and by the treasurer
Code; or assistant treasurer, and shall only contain the following information:

"(D) Taxable income as defined in "(1) Corporate profile and information;

Section 31 of this Code; and
"(2) Gross sales, receipts or income from services
"(E) Income tax due and payable. rendered, or conduct of trade or business, except
income subject to final tax as provided under this
"x x x." Code;

Section 14. A new section designated as Section 51-A of the NIRC, as "(3) Allowable deductions under this Code; "(4) Taxable
amended, is hereby inserted to read as follows: income as defined in Section 31 of this Code; and

"Sec. 51-A. Substituted Filing of Income Tax Returns by Employees "(5) Income tax due and payable.
Receiving Purely Compensation Income - Individual taxpayers receiving
purely compensation income, regardless of amount, from only one Provided, That the foregoing provisions shall not affect the
employer in the Philippines for the calendar year, the income tax of implementation of Republic Act No. 10708 or TIMTA.
which has been withheld correctly by the said employer (tax due equals
tax withheld) shall not be required to file an annual income tax return. "x x x."
The certificate of withholding filed by the respective employers, duly
stamped ‘received’ by the BIR, shall be tantamount to the substituted Section 16. Section 56 of the NIRC, as amended. is hereby further
filing of income tax returns by said employees." amended to read as follows:

Section 15. Section 52 of the NIRC, as amended, is hereby further "Sec. 56. Payment and Assessment of Income Tax for Individuals and
amended to read as follows: Corporations -

"Sec. 52. Corporation Returns - "(A) Payment of Tax -

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"(1) x x - "(C) x x - "

"(2) Installment of Payment. - When a tax due is in Section 18. Section 58 of the NIRC, as amended, is hereby further
excess of Two thousand pesos (₱2,000), the taxpayer amended to read as follows:
other than a corporation, may elect to pay the tax in
two (2) equal installments, in which case, the first "Sec. 58. Return and Payment of Taxes Withheld at Source. -
installment shall be paid at the time the return is filed
and the second installment on or before October 15 "(A) x x x
following the close of the calendar year, if any
installment is not paid on or before the date fixed for "x x x
its payment, the whole amount of the tax unpaid
becomes due and payable together with the "The return for final and creditable withholding taxes shall be filed and
delinquency penalties." the payment made not later than the last day of the month following
the close of the quarter during which withholding was made."
Section 17. Section 57 of the NIRC, as amended, is hereby further
amended to read as follows: Section 19. Section 62 of the NIRC, as amended, is hereby repealed.

"Sec. 57. Withholding of Tax at Source. - Section 20. Section 74 of the NIRC, as amended. is hereby further
amended to read as follows:
"(A) x x -
"Sec. 74. Declaration of Income Tax for Individuals. -
"(B) Withholding of Creditable Tax at Source. - The
Secretary of Finance may, upon the recommendation "(A) In General - Except as otherwise provided in this
of the Commissioner, require the withholding of a tax Section, every individual subject to income tax under
on the items of income payable to natural or juridical Sections 24 and 25(A) of this Title, who is receiving self-
persons, residing in the Philippines, by payor- employment income, whether it constitutes the sole
corporation/persons as provided for by law, at the rate source of his income or in combination with salaries,
of not less than one percent (1%) but not more than wages and other fixed or determinable income, shall
thirty-two percent (32%) thereof, which shall be make and file a declaration of his estimated income for
credited against the income tax liability of the taxpayer the current taxable year on or before May 15 of the
for the taxable year: Provided, That, beginning January same taxable year. x x x
1, 2019, the rate of withholding shall not be less than
one percent (1%) but not more than fifteen percent
"(B) Return and Payment of Estimated Income Tax by
(15%) of the income payment.
Individuals - The amount of estimated income as
defined in Subsection (C) with respect to which a
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declaration is required under Subsection (A) shall be "(F) Year-end Adjustment. - x x x."
paid in four (4) installments. The first installment shall
be paid at the time of declaration and the second and Section 22. Section 84 of the NIRC, as amended, is hereby further
third shall be paid on August 15 and November 15 of amended to read as follows:
the current year, respectively. The fourth installment
shall be paid on or before May 15 of the following "Sec. 84. Rate of Estate Tax. - There shall be levied, assessed, collected
calendar year when the final adjusted income tax and paid upon the transfer of the net estate as determined in
return is due to be filed. accordance with Sections 85 and 86 of every decedent, whether
resident or nonresident of the Philippines, a tax at the rate of six
"(C) x x - " percent (6%) based on the value of such net estate."

Section 21. Section 79 of the NIRC, as amended. is hereby further Section 23. Section 86 of the NIRC, as amended, is hereby further
amended to read as follows: amended to read as follows:

"Sec. 79. Income Tax Collected at Source. - "Sec. 86. Computation of Net Estate.— For the purpose of the tax
imposed in this Chapter, the value of the net estate shall be determined:
"x x x
"(A) Deductions Allowed to the Estate of a Citizen or a Resident - In the
"(C) Refunds or Credits. - case of a citizen or resident of the Philippines, by deducting from the
value of the gross estate—
"(1) Employer. - x x x
"(1) Standard Deduction - An amount equivalent to Five
"(2) Employees. - x x x million pesos (₱5,000,000).

"x x x "(2) For claims against the estate: Provided, That at the
time the indebtedness was incurred the debt
"(D) Withholding on Basis of Average Wages. - x x x instrument was duly notarized and, if the loan was
contracted within three (3) years before the death of
"(1) x x x the decedent, the administrator or executor shall
submit a statement showing the disposition of the
"(2) x x x; and proceeds of the loan.

"(3) x x x. "(3) For claims of the deceased against insolvent

persons where the value of decedent’s interest therein
is included in the value of the gross estate.
"(E) Nonresident Aliens - x x x
 13

"(4) For unpaid mortgages upon, or any indebtedness "One hundred percent (100%) of the value, if
in respect to, property where the value of decedent’s the prior decedent died within one (1) year
interest therein, undiminished by such mortgage or prior to the death of the decedent, or if the
indebtedness, is included in the value of the gross property was transferred to him by gift, within
estate, but not including any income tax upon income the same period prior to his death;
received after the death of the decedent, or property
taxes not accrued before his death, or any estate tax. "Eighty percent (80%) of the value, if the prior
The deduction herein allowed in the case of claims decedent died more than one (1) year but not
against the estate, unpaid mortgages or any more than two (2) years prior to the death of
indebtedness shall, when founded upon a promise or the decedent, or if the property was
agreement, be limited to the extent that they were transferred to him by gift within the same
contracted bona fide and for an adequate and full period prior to his death;
consideration in money or money’s worth. There shall
also be deducted losses incurred during the settlement "Sixty percent (60%) of the value, if the prior
of the estate arising from fires, storms, shipwreck, or decedent died more than two (2) years but
other casualties, or from robbery, theft or not more than three (3) years prior to the
embezzlement, when such losses are not compensated death of the decedent, or if the property was
for by insurance or otherwise, and if at the time of the transferred to him by gift within the same
filing of the return such losses have not been claimed period prior to his death;
as a deduction for the income tax purposes in an
income tax return, and provided that such losses were "Forty percent (40%) of the value, if the prior
incurred not later than the last day for the payment of decedent died more than three (3) years but
the estate tax as prescribed in Subsection (A) of not more than four (4) years prior to the death
Section 91. of the decedent, or if the property was
transferred to him by gift within the same
"(5) Property Previously Taxed. - An amount equal to period prior to his death; and
the value specified below of any property forming part
of the gross estate situated in the Philippines of any "Twenty percent (20%) of the value, if the
person who died within five (5) years prior to the death prior decedent died more than four (4) years
of the decedent, or transferred to the decedent by gift but not more than five (5) years prior to the
within five (5) years prior to his death, where such death of the decedent, or if the property was
property can be identified as having been received by transferred to him by gift within the same
the decedent from the donor by gift, or from such prior period prior to his death.
decedent by gift, bequest, devise or inheritance, or
which can be identified as having been acquired in "These deductions shall be allowed only where
exchange for property so received: a donor’s tax, or estate tax imposed under this
 14

Title was finally determined and paid by or on Philippines, or any political subdivision thereof for
behalf of such donor, or the estate of such exclusively public purposes.
prior decedent, as the case may be, and only
in the amount finally determined as the value "(7) The Family Home. - An amount equivalent to the
of such property in determining the value of current fair market value of the decedent’s family
the gift, or the gross estate of such prior home: Provided, however, That if the said current fair
decedent, and only to the extent that the market value exceeds Ten million pesos (₱10,000,000),
value of such property is included in the the excess shall be subject to estate tax.
decedent’s gross estate, and only if in
determining the value of the estate of the "(8) Amount Received by Heirs Under Republic Act No.
prior decedent, no deduction was allowable 4917 - Any amount received by the heirs from the
under paragraph (5) in respect of the property decedent’s employee as a consequence of the death of
or properties given in exchange therefor. the decedent-employee in accordance with Republic
Where a deduction was allowed of any Act No. 4917: Provided, That such amount is included
mortgage or other lien in determining the in the gross estate of the decedent.
donor’s tax, or the estate tax of the prior
decedent, which was paid in whole or in part "(B) Deductions Allowed to Nonresident Estates - In the case of a
prior to the decedent’s death, then the nonresident not a citizen of the Philippines, by deducting from the value
deduction allowable under said Subsection of that part of his gross estate which at the time of his death is situated
shall be reduced by the amount so paid. Such in the Philippines:
deduction allowable shall be reduced by an
amount which bears the same ratio to the "(1) Standard Deduction - An amount equivalent to Five
amounts allowed as deductions under hundred thousand pesos (₱500,000);
paragraphs (2), (3), (4), and (6) of this
Subsection as the amount otherwise
"(2) That proportion of the deductions specified in
deductible under said paragraph (5) bears to
paragraphs (2), (3), and (4) of Subsection (A) of this
the value of the decedent’s estate. Where the
Section which the value of such part bears to the value
property referred to consists of two or more
of his entire gross estate wherever situated;
items, the aggregate value of such items shall
be used for the purpose of computing the
"(3) Property Previously Taxed - x x x
deduction.
"(4) Transfers for Public Use - The amount of all
"(6) Transfers for Public Use - The amount of all
bequests, legacies, devises or transfers to or for the
bequests, legacies, devises or transfers to or for the
use of the Government of the Republic of the
use of the Government of the Republic of the
 15

Philippines or any political subdivision thereof, for Section 25. Section 90 of the NIRC, as amended, is hereby further
exclusively public purposes. amended to read as follows:

"(C) Share in the Conjugal Property - The net share of the surviving "Sec. 90. Estate Tax Returns. -
spouse in the conjugal partnership property as diminished by the
obligations properly chargeable to such property shall, for the purpose "(A) Requirements. - In all cases of transfers subject to the tax imposed
of this Section, be deducted from the net estate of the decedent. herein, or regardless of the gross value of the estate, where the said
estate consists of registered or registrable property such as real
"(D) Tax Credit for Estate Taxes Paid to a Foreign Country - property, motor vehicle, shares of stock or other similar property for
which a clearance from the Bureau of Internal Revenue is required as a
"(1) In General - The tax imposed by this Title shall be condition precedent for the transfer of ownership thereof in the name
credited with the amounts of any estate tax imposed of the transferee, the executor, or the administrator, or any of the legal
by the authority of a foreign country. heirs, as the case may be, shall file a return under oath in duplicate,
setting forth:
"(2) Limitations on Credit. - The amount of the credit
taken under this Section shall be subject to each of the "(1) x x x
following limitations:
"(2) x x x
"(a) The amount of the credit in respect to the
tax paid to any country shall not exceed the "(3) Such part of such information as may at the time
same proportion of the tax against which such be ascertainable and such supplemental data as may
credit is taken, which the decedent’s net be necessary to establish the correct taxes.
estate situated within such country taxable
under this Title bears to his entire net estate; "Provided, however, That estate tax returns showing a gross value
and exceeding Five million pesos (₱5,000,000) shall be supported with a
statement duly certified to by a Certified Public Accountant containing
"(b) The total amount of the credit shall not the following:
exceed the same proportion of the tax against
which such credit is taken, which the "x x x
decedent’s net estate situated outside the
Philippines taxable under this Title bears to his "(B) Time for Filing - For the purpose of determining the estate tax
entire net estate." provided for in Section 84 of this Code, the estate tax return required
under the preceding Subsection (A) shall be filed within one (1) year
Section 24. Section 89 of the NIRC, as amended, is hereby repealed. from the decedent’s death.
 16

"x x x." living at the time of withdrawal by any one of the joint depositors and
such statement shall be under oath by the said depositors."
Section 26. Section 91 of the NIRC, as amended, is hereby further
amended to read as follows: Section 28. Section 99 of the NIRC, as amended, is hereby further
amended to read as follows:
"Sec. 91. Payment of Tax. -
"Sec. 99. Rate of Tax Payable by Donor -
"(A) Time of Payment - x x x
"(A) In General. - The tax for each calendar year shall
"(B) Extension of Time - x x x be six percent (6%) computed on the basis of the total
gifts in excess of Two hundred fifty thousand pesos
"x x x (₱250,000) exempt gift made during the calendar year.

"(C) Payment by Installment - In case the available cash "(B) Any contribution in cash or in kind to any
of the estate is insufficient to pay the total estate tax candidate, political party or coalition of parties for
due, payment by installment shall be allowed within campaign purposes shall be governed by the Election
two (2) years from the statutory date for its payment Code, as amended."
without civil penalty and interest.
Section 29. Section 100 of the NIRC, as amended, is hereby further
"(D) Liability for Payment - x x x amended to read as follows:

"x x x "Sec. 100. Transfer for Less Than Adequate and Full Consideration -
Where property, other than real property referred to in Section 24(D), is
Section 27. Section 97 of the NIRC, as amended, is hereby further transferred for less than an adequate and full consideration in money or
amended to read as follows: money’s worth, then the amount by which the fair market value of the
property exceeded the value of the consideration shall, for the purpose
"Sec. 97. Payment of Tax Antecedent to the Transfer of Shares, Bonds or of the tax imposed by this Chapter, be deemed a gift, and shall be
Rights - x x x. included in computing the amount of gifts made during the calendar
year: Provided, however, That a sale, exchange, or other transfer of
property made in the ordinary course of business (a transaction which is
"If a bank has knowledge of the death of a person, who maintained a
a bona fide, at arm’s length, and free from any donative intent), will be
bank deposit account alone, or jointly with another, it shall allow any
considered as made for an adequate and full consideration in money or
withdrawal from the said deposit account, subject to a final withholding
money’s worth."
tax of six percent (6%). For this purpose, all withdrawal slips shall
contain a statement to the effect that all of the joint depositors are still
 17

Section 30. Section 101 of the NIRC, as amended, is hereby further Section 31. Section 106 of the NIRC, as amended, is hereby further
amended to read as follows: amended to read as follows:

"Sec. 101. Exemption of Certain Gifts - The following gifts or donations "Sec. 106. Value-added Tax on Sale of Goods or Properties -
shall be exempt from the tax provided for in this Chapter:
"(A) Rate and Base of Tax - There shall be levied, assessed and collected
"(A) In the Case of Gifts Made by a Resident - on every sale, barter or exchange of goods or properties, a value-added
tax equivalent to twelve percent (12%) of the gross selling price or gross
"(1) Gifts made to or for the use of the National value in money of the goods or properties sold, bartered or exchanged,
Government or any entity created by any of its such tax to be paid by the seller or transferor.
agencies which is not conducted for profit, or to any
political subdivision of the said Government; and "(1) x x x

"(2) Gifts in favor of an educational and/or charitable, "(2) The following sales by VAT-registered persons shall
religious, cultural or social welfare corporation, be subject to zero percent (0%) rate:
institution, accredited nongovernment organization,
trust or philanthropic organization or research "(a) Export Sales - The term ‘export sales’
institution or organization: Provided, however, That not means:
more than thirty percent (30%) of said gifts shall be
used by such donee for administration purposes. For "(1) The sale and actual shipment of goods
the purpose of this exemption, a ‘non-profit from the Philippines to a foreign country,
educational and/or charitable corporation, institution, irrespective of any shipping arrangement that
accredited nongovernment organization, trust or may be agreed upon which may influence or
philanthropic organization and/or research institution determine the transfer of ownership of the
or organization’ is a school, college or university and/or goods so exported and paid for in acceptable
charitable corporation, accredited nongovernment foreign currency or its equivalent in goods or
organization, trust or philanthropic organization and/ services, and accounted for in accordance with
or research institution or organization, incorporated as the rules and regulations of the Bangko Sentral
a nonstock entity, paying no dividends, governed by ng Pilipinas (BSP);
trustees who receive no compensation, and devoting
all its income, whether students’ fees or gifts, "(2) Sale and delivery of goods to:
donation, subsidies or other forms of philanthropy, to
the accomplishment and promotion of the purposes "(i) Registered enterprises within a
enumerated in its Articles of Incorporation. separate customs territory as
provided under special laws; and
"x x x."
 18

"(ii) Registered enterprises within "(1) The successful establishment and implementation
tourism enterprise zones as declared of an enhanced VAT refund system that grants refunds
by the Tourism Infrastructure and of creditable input tax within ninety (90) days from the
Enterprise Zone Authority (TIEZA) filing of the VAT refund application with the
subject to the provisions under Bureau: Provided, That, to determine the effectivity of
Republic Act No. 9593 or The Tourism item no. 1, all applications filed from January 1, 2018
Act of 2009. shall be processed and must be decided within ninety
(90) days from the filing of the VAT refund application;
"(3) Sale of raw materials or packaging materials to a and
nonresident buyer for delivery to a resident local
export-oriented enterprise to be used in "(2) All pending VAT refund claims as of December 31,
manufacturing, processing, packing or repacking in the 2017 shall be fully paid in cash by December 31, 2019.
Philippines of the said buyer’s goods and paid for in
acceptable foreign currency and accounted for in "Provided, That the Department of Finance shall establish a VAT refund
accordance with the rules and regulations of the center in the Bureau of Internal Revenue (BIR) and in the Bureau of
Bangko Sentral ng Pilipinas (BSP); Customs (BOC) that will handle the processing and granting of cash
refunds of creditable input tax.
"(4) Sale of raw materials or packaging materials to
export-oriented enterprise whose export sales exceed "An amount equivalent to five percent (5%) of the total VAT collection
seventy percent (70%) of total annual production; of the BIR and the BOC from the immediately preceding year shall be
automatically appropriated annually and shall be treated as a special
"(5) Those considered export sales under Executive account in the General Fund or as trust receipts for the purpose of
Order No. 226, otherwise known as the Omnibus funding claims for VAT refund: Provided, That any unused fund, at the
Investment Code of 1987, and other special laws; and end of the year shall revert to the General Fund.

"(6) The sale of goods, supplies, equipment and fuel to "Provided, further, That the BIR and the BOC shall be required to submit
persons engaged in international shipping or to the Congressional Oversight Committee on the Comprehensive Tax
international air transport operations: Provided, That Reform Program (COCCTRP) a quarterly report of all pending claims for
the goods, supplies, equipment and fuel shall be used refund and any unused fund.
for international shipping or air transport operations.
"(b) Sales to persons or entities whose exemption under special laws or
"Provided, That subparagraphs (3), (4), and (5) hereof shall be subject to international agreements to which the Philippines is a signatory
the twelve percent (12%) value-added tax and no longer be considered effectively subjects such sales to zero rate.
export sales subject to zero percent (0%) VAT rate upon satisfaction of
the following conditions: "x x x."
 19

Section 32. Section 107 of the NIRC, as amended, is hereby further resthouses, pension houses, inns, resorts; proprietors or operators of
amended to read as follows: restaurants, refreshment parlors, cafes and other eating places,
including clubs and caterers; dealers in securities; lending investors;
"Sec. 107. Value-added Tax on Importation of Goods. - "(A) In General. - transportation contractors on their transport of goods or cargoes,
There shall be levied, assessed and collected on every importation of including persons who transport goods or cargoes for hire and other
goods a value-added tax equivalent to twelve percent (12%) based on domestic common carriers by land relative to their transport of goods or
the total value used by the Bureau of Customs in determining tariff and cargoes; common carriers by air and sea relative to their transport of
customs duties, plus customs duties, excise taxes, if any, and other passengers, goods or cargoes from one place in the Philippines to
charges, such tax to be paid by the importer prior to the release of such another place in the Philippines; sales of electricity by generation
goods from customs custody: Provided, That where the customs duties companies, transmission by any entity, and distribution companies,
are determined on the basis of the quantity or volume of the goods, the including electric cooperatives; services of franchise grantees of electric
value-added tax shall be based on the landed cost plus excise taxes, if utilities, telephone and telegraph, radio and television broadcasting and
any. all other franchise grantees except those under Section 119 of this Code
and non-life insurance companies (except their crop insurances),
"(B) Transfer of Goods by Tax-exempt Persons. - x x x." including surety, fidelity, indemnity and bonding companies; and similar
services regardless of whether or not the performance thereof calls for
Section 33. Section 108 of the NIRC, as amended, is hereby further the exercise or use of the physical or mental faculties. The phrase ‘sale
amended to read as follows: or exchange of services’ shall likewise include:

"Sec. 108. Value-added Tax on Sale of Services and Use or Lease of "(1) The lease or the use of or the right or privilege to
Properties.— use any copyright, patent, design or model, plan,
secret formula or process, goodwill, trademark, trade
"(A) Rate and Base of Tax. - There shall be levied, assessed and brand or other like property or right;
collected, a value-added tax equivalent to twelve percent (12%) of gross
receipts derived from the sale or exchange of services, including the use "(2) The lease or the use of, or the right to use of any
or lease of properties. industrial, commercial or scientific equipment;

"The phrase ‘sale or exchange of services’ means the performance of all "(3) The supply of scientific, technical industrial or
kinds of services in the Philippines for others for a fee, remuneration or commercial knowledge or information;
consideration, including those performed or rendered by construction
and service contractors; stock, real estate, commercial, customs and "(4) The supply of any assistance that is ancillary and
immigration brokers; lessors of property, whether personal or real; subsidiary to and is furnished as a means of enabling
warehousing services; lessors or distributors of cinematographic films; the application or enjoyment of any such property, or
persons engaged in milling, processing, manufacturing or repacking right as is mentioned in subparagraph (2) or any such
goods for others; proprietors, operators or keepers of hotels, motels, knowledge or information as is mentioned in
subparagraph (3);
 20

"(5) The supply of services by a nonresident person or "(1) Processing, manufacturing or repacking goods for
his employee in connection with the use of property or other persons doing business outside the Philippines
rights belonging to, or the installation or operation of which goods are subsequently exported, where the
any brand, machinery or other apparatus purchased services are paid for in acceptable foreign currency and
from such nonresident person; accounted for in accordance with the rules and
regulations of the Bangko Sentral ng Pilipinas (BSP);
"(6) The supply of technical advice, assistance or
services rendered in connection with technical "(2) Services other than those mentioned in the
management or administration of any scientific preceding paragraph, rendered to a person engaged in
industrial or commercial undertaking, venture, business conducted outside the Philippines or to a
projector scheme; nonresident person not engaged in business who is
outside the Philippines when the services are
"(7) The lease of motion picture films, -films, tapes and performed, the consideration for which is paid for in
discs; and acceptable foreign currency and accounted for in
accordance with the rules and regulations of the
"(8) The lease or the use of or the right to use radio, Bangko Sentral ng Pilipinas (BSP);
television, satellite transmission and cable television
time. "(3) Services rendered to persons or entities whose
exemption under special laws or international
"Lease of properties shall be subject to the tax herein imposed agreements to which the Philippines is a signatory
irrespective of the place where the contract of lease or licensing effectively subjects the supply of such services to zero
agreement was executed if the property is leased or used in the percent (0%) rate;
Philippines.
"(4) Services rendered to persons engaged in
"The term ‘gross receipts’ means the total amount of money or its international shipping or international air transport
equivalent representing the contract price, compensation, service fee, operations, including leases of property for use
rental or royalty, including the amount charged for materials supplied thereof: Provided, That these services shall be exclusive
with the services and deposits and advanced payments actually or for international shipping or air transport operations;
constructively received during the taxable quarter for the services
performed or to be performed for another person, excluding value- "(5) Services performed by subcontractors and/or
added tax. contractors in processing, converting, or
manufacturing goods for an enterprise whose export
"(B) Transactions Subject to Zero Percent (0%) Rate. - The following sales exceed seventy percent (70%) of total annual
services performed in the Philippines by VAT registered persons shall be production;
subject to zero percent (0%) rate:
 21

"(6) Transport of passengers and cargo by domestic air (90) days from the filing of the VAT refund application;
or sea vessels from the Philippines to a foreign country; and
and
"(2) All pending VAT refund claims as of December 31,
"(7) Sale of power or fuel generated through 2017 shall be fully paid in cash by December 31, 2019.
renewable sources of energy such as, but not limited
to, biomass, solar, wind, hydropower, geothermal, "Provided, That the Department of Finance shall establish a VAT refund
ocean energy, and other emerging energy sources center in the Bureau of Internal Revenue (BIR) and in the Bureau of
using technologies such as fuel cells and hydrogen Customs (BOC) that will handle the processing and granting of cash
fuels. refunds of creditable input tax.

"(8) Services rendered to: "An amount equivalent to five percent (5%) of the total value-added tax
collection of the BIR and the BOC from the immediately preceding year
"(i) Registered enterprises within a separate shall be automatically appropriated annually and shall be treated as a
customs territory as provided under special special account in the General Fund or as trust receipts for the purpose
law; and of funding claims for VAT Refund: Provided, That any unused fund, at
the end of the year shall revert to the General Fund.
"(ii) Registered enterprises within tourism
enterprise zones as declared by the TIEZA "Provided, further, That the BIR and the BOC shall be required to submit
subject to the provisions under Republic Act to the COCCTRP a quarterly report of all pending claims for refund and
No. 9593 or The Tourism Act of 2009. any unused fund."

"Provided, That subparagraphs (B)(1) and (B)(5) hereof shall be subject Section 34. Section 109 of the NIRC, as amended, is hereby further
to the twelve percent (12%) value-added tax and no longer be subject to amended to read as follows:
zero percent (0%) VAT rate upon satisfaction of the following
conditions: "Sec. 109. Exempt Transactions. - (1) Subject to the provisions of
Subsection (2) hereof, the following transactions shall be exempt from
"(1) The successful establishment and implementation the value-added tax:
of an enhanced VAT refund system that grants refunds
of creditable input tax within ninety (90) days from the "(A) x x x
filing of the VAT refund application with the
Bureau: Provided, That, to determine the effectivity of "(B) x x x
item no. 1, all applications filed from January 1, 2018
shall be processed and must be decided within ninety "(C) x x x
 22

"(D) Importation of professional instruments and Skills Development Authority (TESDA) and those
implements, tools of trade, occupation or employment, rendered by government educational institutions;
wearing apparel, domestic animals, and personal and
household effects belonging to persons coming to "(I) Services rendered by individuals pursuant to an
settle in the Philippines or Filipinos or their families and employer-employee relationship;
descendants who are now residents or citizens of other
countries, such parties hereinafter referred to as "(J) Services rendered by regional or area headquarters
overseas Filipinos, in quantities and of the class established in the Philippines by multinational
suitable to the profession, rank or position of the corporations which act as supervisory, communications
persons importing said items, for their own use and and coordinating centers for their affiliates,
not for barter or sale, accompanying such persons, or subsidiaries or branches in the Asia-Pacific Region and
arriving within a reasonable time: Provided, That the do not earn or derive income from the Philippines;
Bureau of Customs may, upon the production of
satisfactory evidence that such persons are actually "(K) Transactions which are exempt under international
coming to settle in the Philippines and that the goods agreements to which the Philippines is a signatory or
are brought from their former place of abode, exempt under special laws, except those under Presidential
such goods from payment of duties and Decree No. 529;
taxes: Provided, further, That vehicles, vessels,
aircrafts, machineries and other similar goods for use "(L) Sales by agricultural cooperatives duly registered
in manufacture, shall not fall within this classification with the Cooperative Development Authority to their
and shall therefore be subject to duties, taxes and members as well as sale of their produce, whether in
other charges; its original state or processed form, to non-members;
their importation of direct farm inputs, machineries
"(E) Services subject to percentage tax under Title V; and equipment, including spare parts thereof, to be
used directly and exclusively in the production and/or
"(F) Services by agricultural contract growers and processing of their produce;
milling for others of palay into rice, corn into grits and
sugar cane into raw sugar; "(M) Gross receipts from lending activities by credit or
multi-purpose cooperatives duly registered with the
"(G) Medical, dental, hospital and veterinary services Cooperative Development Authority;
except those rendered by professionals;
"(N) Sales by non-agricultural, non-electric and non-
"(H) Educational services rendered by private credit cooperatives duly registered with the
educational institutions, duly accredited by the Cooperative Development Authority: Provided, That
Department of Education (DepEd), the Commission on the share capital contribution of each member does
Higher Education (CHED), the Technical Education and
 23

not exceed Fifteen thousand pesos (₱15,000) and appears at regular intervals with fixed prices or
regardless of the aggregate capital and net surplus subscription and sale and which is not devoted
ratably distributed among the members; principally to the publication of paid advertisements;

"(O) Export sales by persons who are not VAT- "(S) Transport of passengers by international carriers;
registered;
"(T) Sale, importation or lease of passenger or cargo
"(P) Sale of real properties not primarily held for sale to vessels and aircraft, including engine, equipment and
customers or held for lease in the ordinary course of spare parts thereof for domestic or international
trade or business or real property utilized for low-cost transport operations;
and socialized housing as defined by Republic Act No.
7279, otherwise known as the Urban Development and "(U) Importation of fuel, goods and supplies by persons
Housing Act of 1992, and other related laws, engaged in international shipping or air transport
residential lot valued at One million five hundred operations: Provided, That the fuel, goods, and supplies
thousand pesos (₱1,500,000) and below, house and shall be used for international shipping or air transport
lot, and other residential dwellings valued at Two operations;
million five hundred thousand pesos (₱2,500,000) and
below: Provided, That beginning January 1, 2021, the "(V) Services of bank, non-bank financial intermediaries
VAT exemption shall only apply to sale of real performing quasi-banking functions, and other non-
properties not primarily held for sale to customers or bank financial intermediaries;
held for lease in the ordinary course of trade or
business, sale of real property utilized for socialized "(W) Sale or lease of goods and services to senior
housing as defined by Republic Act No. 7279, sale of citizens and persons with disability, as provided under
house and lot, and other residential dwellings with Republic Act Nos. 9994 (Expanded Senior Citizens Act
selling price of not more than Two million pesos of 2010) and 10754 (An Act Expanding the Benefits and
(₱2,000,000): Provided, further, That every three (3) Privileges of Persons With Disability), respectively;
years thereafter, the amount herein stated shall be
adjusted to its present value using the Consumer Price "(X) Transfer of property pursuant to Section 40(C)(2)
Index, as published by the Philippine Statistics of the NIRC, as amended;
Authority (PSA);
"(Y) Association dues, membership fees, and other
"(Q) Lease of a residential unit with a monthly rental assessments and charges collected by homeowners
not exceeding Fifteen thousand pesos (₱15,000); associations and condominium corporations;

"(R) Sale, importation, printing or publication of books

and any newspaper, magazine, review or bulletin which
 24

"(Z) Sale of gold to the Bangko Sentral ng Pilipinas purchased or imported shall be allowed to apply the same as scheduled
(BSP); until fully utilized: Provided, finally, That in the case of purchase of
services, lease or use of properties, the input tax shall be creditable to
"(AA) Sale of drugs and medicines prescribed for the purchaser, lessee or licensee upon payment of the compensation,
diabetes, high cholesterol, and hypertension beginning rental, royalty or fee.
January 1, 2019; and
"x x x."
"(BB) Sale or lease of goods or properties or the
performance of services other than the transactions Section 36. Section 112 of the NIRC, as amended, is hereby further
mentioned in the preceding paragraphs, the gross amended to read as follows:
annual sales and/or receipts do not exceed the amount
of Three million pesos (₱3,000,000). "Sec. 112. Refunds or Tax Credits of Input Tax -

Section 35. Section 110 of the NIRC, as amended, is hereby further "(A) x x x
amended to read as follows:
"(B) x x x
"Sec. 110. Tax Credits. - "(A) Creditable Input Tax. - "(1) x x x
"(C) Period within which Refund of Input Taxes shall be
"(2) x x x Made.— In proper cases, the Commissioner shall grant
a refund for creditable input taxes within ninety (90)
"(a) x x x days from the date of submission of the official
receipts or invoices and other documents in support of
"(b) x x x the application filed in accordance with Subsections (A)
and (B) hereof: Provided, That should the
"Provided, That the input tax on goods purchased or imported in a Commissioner find that the grant of refund is not
calendar month for use in trade or business for which deduction for proper, the Commissioner must state in writing the
depreciation is allowed under this Code shall be spread evenly over the legal and factual basis for the denial.
month of acquisition and the fifty-nine (59) succeeding months if the
aggregate acquisition cost for such goods, excluding the VAT component "In case of full or partial denial of the claim for tax refund, the taxpayer
thereof, exceeds One million pesos (₱1,000,000): Provided, however, affected may, within thirty (30) days from the receipt of the decision
That if the estimated useful life of the capital good is less than five (5) denying the claim, appeal the decision with the Court of Tax
years, as used for depreciation purposes, then the input VAT shall be Appeals: Provided, however, That failure on the part of any official,
spread over such a shorter period: Provided, further, That the agent, or employee of the BIR to act on the application within the ninety
amortization of the input VAT shall only be allowed until December 31, (90)-day period shall be punishable under Section 269 of this Code.
2021 after which taxpayers with unutilized input VAT on capital goods
 25

"x x x." to the final withholding tax system as imposed in this Subsection. For
purposes of this Section, the payor or person in control of the payment
Section 37. Section 114 of the NIRC, as amended, is hereby further shall be considered as the withholding agent.
amended to read as follows:
Section 38. Section 116 of the NIRC, as amended, is hereby further
"Sec. 114. Return and Payment of Value-added Tax. - "(A) In General. - amended to read as follows:
Every person liable to pay the value-added tax imposed under this Title
shall file a quarterly return of the amount of his gross sales or receipts "Sec. 116. Tax on Persons Exempt from Value-added Tax (VAT). - Any
within twenty-five (25) days following the close of each taxable quarter person whose sales or receipts are exempt under Section 109(BB) of this
prescribed for each taxpayer: Provided, however, That VAT-registered Code from the payment of value-added tax and who is not a VAT-
persons shall pay the value-added tax on a monthly basis: Provided, registered person shall pay a tax equivalent to three percent (3%) of his
finally, That beginning January 1, 2023, the filing and payment required gross quarterly sales or receipts: Provided, That cooperatives, and
under this Subsection shall be done within twenty-five (25) days beginning January 1, 2019, self-employed and professionals with total
following the close of each taxable quarter. annual gross sales and/or gross receipts not exceeding Five hundred
thousand pesos (₱500,000) shall be exempt from the three percent (3%)
"x x x gross receipts tax herein imposed."

"(B) x x x Section 39. Section 127 of the NIRC, as amended, is hereby further
amended to read as follows:
"(C) Withholding of Value-added Tax. - The Government or any of its
political subdivisions, instrumentalities or agencies, including "Sec. 127. Tax on Sale, Barter or Exchange of Shares of Stock Listed and
government-owned or -controlled corporations (GOCCs) shall, before Traded through the Local Stock Exchange or through Initial Public
making payment on account of each purchase of goods and services Offering -
which are subject to the value-added tax imposed in Sections 106 and
108 of this Code, deduct and withhold the value-added tax imposed in "(A) Tax on Sale, Barter or Exchange of Shares of Stock Listed and
Sections 106 and 108 of this Code, deduct and withhold a final value- Traded through the Local Stock Exchange.— There shall be levied,
added tax at the rate of five percent (5%) of the gross payment assessed and collected on every sale, barter, exchange or other
thereof: Provided, That beginning January 1, 2021, the VAT witholding disposition of shares of stock listed and traded through the local stock
system under this Subsection shall shift from final to a creditable exchange other than the sale by a dealer in securities, a tax at the rate
system: Provided, further, That the payment for lease or use of of six-tenths of one percent (6⁄10 of 1%) of the gross selling price or
properties or property rights to nonresident owners shall be subject to gross value in money of the shares of stock sold, bartered, exchanged or
twelve percent (12%) withholding tax at the time of payment: Provided, otherwise disposed which shall be paid by the seller or transferor.
finally, That payments for purchases of goods and services arising from
projects funded by Official Development Assistance (ODA) as defined "x x x."
under Republic Act No. 8182, otherwise known as the ‘Official
Development Assistance Act of 1996’, as amended, shall not be subject
 26

Section 40. Section 128 of the NIRC, as amended, is hereby further Section 42. Section 145 of the NIRC, as amended, is hereby further
amended to read as follows: amended to read as follows:

"Sec. 128. Returns and Payment of Percentage Taxes - "Sec. 145. Cigars and Cigarettes -

"(A) x x x "(A) Cigars.— x x x

"(1) x x x "(B) Cigarettes Packed by Hand.— There shall be

levied, assessed and collected on cigarettes packed by
"(2) Persons Retiring from Business.— x x x hand an excise tax based on the following schedules:

"(3) Determination of Correct Sales or Receipts.— x x x "Effective on January 1, 2018 until June 30, 2018,
Thirty-two pesos and fifty centavos (₱32.50) per pack;
"x x x."
"Effective on July 1, 2018 until December 31, 2019,
Section 41. Section 129, Chapter 1 of Title VI of the NIRC, as amended, is Thirty-five pesos (₱35.00) per pack;
hereby further amended to read as follows:
"Effective on January 1, 2020 until December 31, 2021,
"TITLE VI–EXCISE TAXES ON CERTAIN GOODS AND SERVICES Thirty-seven pesos and fifty centavos (₱37.50) per
pack; and
"CHAPTER 1—GENERAL PROVISIONS
"Effective on January 1, 2022 until December 31, 2023,
"Sec. 129. Goods and Services Subject to Excise Taxes. - Excise taxes Forty pesos (₱40.00)per pack.1âwphi1

apply to goods manufactured or produced in the Philippines for

domestic sales or consumption or for any other disposition and to things "The rates of tax imposed under this subsection shall
imported as well as services performed in the Philippines. The excise tax be increased by four percent (4%) every year effective
imposed herein shall be in addition to the value-added tax imposed on January 1, 2024, through revenue regulations issued
under Title IV. by the Secretary of Finance.

"For purposes of this Title, excise taxes herein imposed and based on "Duly registered cigarettes packed by hand shall only
weight or volume capacity or any other physical unit of measurement be packed in twenties and other packaging
shall be referred to as ‘specific tax’ and an excise tax herein imposed combinations of not more than twenty.
and based on selling price or other specified value of the good or service
performed shall be referred to as ‘ad valorem tax.’" "‘Cigarettes packed by hand’ shall refer to the manner
of packaging of cigarette sticks using an individual
 27

person’s hands and not through any other means such "Effective January 1, 2018
as a mechanical device, machine or equipment.
"(a) Lubricating oils and greases, including but not
"(C) Cigarettes Packed by Machine. — There shall be limited to, basestock for lube oils and greases, high
levied, assessed and collected on cigarettes packed by vacuum distillates, aromatic extracts and other similar
machine a tax at the rates prescribed below: preparations, and additives for lubricating oils and
greases, whether such additives are petroleum based
"Effective on January 1, 2018 until June 30, 2018, the or not, per liter and kilogram, respectively, of volume
tax on all cigarettes packed by machine shall be Thirty- capacity or weight, Eight pesos (₱8.00): Provided, That
two pesos and fifty centavos (₱32.50) per pack; lubricating oils and greases produced from basestocks
and additives on which the excise tax has already been
"Effective on July 1, 2018 until December 31, 2019, the paid shall no longer be subject to excise tax: Provided,
tax on all cigarettes packed by machine shall be Thirty- further, That locally produced or imported oils
five pesos (₱35.00) per pack; previously taxed as such but are subsequently
reprocessed, refined or recycled shall likewise be
"Effective on January 1, 2020 until December 31, 2021, subject to the tax imposed under this Subsection;
the tax on all cigarettes packed by machine shall be
Thirty-seven pesos and fifty centavos (₱37.50) per "(b) Processed gas, per liter of volume capacity, Eight
pack; and pesos (₱8.00);

"Effective on January 1, 2022 until December 31, 2023, "(c) Waxes and petrolatum, per kilogram, Eight pesos
the tax on all cigarettes packed by machine shall be (₱8.00);
Forty pesos (₱40.00) per pack.
"(d) On denatured alcohol to be used for motive
"The rates of tax imposed under this Subsection shall be increased by power, per liter of volume capacity, Eight pesos
four percent (4%) every year thereafter effective on January 1, 2024, (₱8.00): Provided, That unless otherwise provided by
through revenue regulations issued by the Secretary of Finance." special laws, if the denatured alcohol is mixed with
gasoline, the excise tax on which has already been
Section 43. Section 148 of the NIRC, as amended, is hereby further paid, only the alcohol content shall be subject to the
amended to read as follows: tax herein prescribed. For purposes of this Subsection,
the removal of denatured alcohol of not less than one
"Sec. 148. Manufactured Oils and Other Fuels. - There shall be collected hundred eighty degrees (180°) proof (ninety percent
on refined and manufactured mineral oils and motor fuels, the following (90%) absolute alcohol) shall be deemed to have been
excise taxes which shall attach to the goods hereunder enumerated as removed for motive power, unless shown otherwise;
soon as they are in existence as such:
 28

"(e) Naphtha, regular gasoline, pyrolysis gasoline and aviation turbo jet fuel under the preceding paragraph
other similar products of distillation, per liter of volume (g), such tax to be assessed on the user thereof;
capacity, Seven pesos (₱7.00): Provided, however, That
naphtha and pyrolysis gasoline, when used as a raw "(i) Diesel fuel oil, and on similar fuel oils having more
material in the production of petrochemical products, or less the same generating power, per liter of volume
or in the refining of petroleum products, or as capacity, Two pesos and fifty centavos (₱2.50);
replacement fuel for natural-gas-fired-combined cycle
power plant in lieu of locally-extracted natural gas "(j) Liquefied petroleum gas, per kilogram, One peso
during the non-availability thereof, subject to the rules (₱1.00): Provided, That liquefied petroleum gas when
and regulations to be promulgated by the Secretary of used as raw material in the production of
Finance, per liter of volume capacity, zero petrochemical products, subject to the rules and
(₱0.00): Provided, further, That the production of regulations to be promulgated by the Secretary of
petroleum products, whether or not they are classified Finance, shall be taxed zero (₱0.00) per kilogram:
as products of distillation and for use solely for the
production of gasoline shall be exempt from excise "Provided, finally, That liquefied petroleum gas used
tax: Provided, finally, That the by-product including fuel for motive power shall be taxed at the equivalent rate
oil, diesel fuel, kerosene, pyrolysis gasoline, liquefied as the excise tax on diesel fuel oil;
petroleum gases and similar oils having more or less
the same generating power, which are produced in the "(k) Asphalts, per kilogram, Eight pesos (₱8.00);
processing of naphtha into petrochemical products
shall be subject to the applicable excise tax specified in
"(l) Bunker fuel oil, and on similar fuel oils having more
this Section, except when such by-products are
or less the same generating power, per liter of volume
transferred to any of the local oil refineries through
capacity, Two pesos and fifty centavos
sale, barter or exchange, for the purpose of further
(₱2.50): Provided, however, That the excise taxes paid
processing or blending into finished products which are
on the purchased basestock (bunker) used in the
subject to excise tax under this Section;
manufacture of excisable articles and forming part
thereof shall be credited against the excise tax due
"(f) Unleaded premium gasoline, per liter of volume therefrom; and
capacity, Seven pesos (₱7.00);
"(m) Petroleum coke, per metric ton, Two pesos and
"(g) Aviation turbo jet fuel, aviation gas, per liter of fifty centavos.(₱2.50): Provided, however, That,
volume capacity, Four pesos (₱4.00); petroleum coke, when used as feedstock to any power
generating facility, per metric ton, zero (₱0.00).
"(h) Kerosene, per liter of volume capacity, Three pesos
(₱3.00): Provided, That kerosene, when used as "Effective January 1, 2019
aviation fuel, shall be subject to the same tax on
 29

"(a) Lubricating oils and greases, including but not naphtha and pyrolysis gasoline, when used as a raw
limited to, basestock for lube oils and greases, high material in the production of petrochemical products,
vacuum distillates, aromatic extracts and other similar or in the refining of petroleum products, or as
preparations, and additives for lubricating oils and replacement fuel for natural-gas-fired-combined
greases, whether such additives are petroleum based cyclepower plant in lieu of locally-extracted natural gas
or not, per liter and kilogram, respectively, of volume during the non-availability thereof, subject to the rules
capacity or weight, Nine pesos (₱9.00): Provided, That and regulations to be promulgated by the Secretary of
lubricating oils and greases produced from basestocks Finance, per liter of volume capacity, zero
and additives on which the excise tax has already been (₱0.00): Provided, further, That the production of
paid shall no longer be subject to excise tax: Provided, petroleum products, whether or not they are classified
further, That locally produced or imported oils as products of distillation and for use solely for the
previously taxed as such but are subsequently production of gasoline shall be exempt from excise
reprocessed, rerefined or recycled shall likewise be tax: Provided, finally, That the by-product including fuel
subject to the tax imposed under this Subsection. oil, diesel fuel, kerosene, pyrolysis gasoline, liquefied
petroleum, gases and similar oils having more or less
"(b) Processed gas, per liter of volume capacity, Nine the same generating power, which are produced in the
pesos (₱9.00); processing of naphtha into petrochemical products
shall be subject to the applicable excise tax specified in
"(c) Waxes and petrolatum, per kilogram, Nine pesos this Section, except when such by-products are
(₱9.00); transferred to any of the local oil refineries through
sale, barter or exchange, for the purpose of further
"(d) On denatured alcohol to be used for motive processing or blending into finished products which are
power, per liter of volume capacity, Nine pesos subject to excise tax under this Section;
(₱9.00): Provided, That unless otherwise provided by
special laws, if the denatured alcohol is mixed with "(f) Unleaded premium gasoline, per liter of volume
gasoline, the excise tax on which has already been capacity, Nine pesos (₱9.00);
paid, only the alcohol content shall be subject to the
tax herein prescribed. For purposes of this Subsection, "(g) Aviation turbo jet fuel, aviation gas, per liter of
the removal of denatured alcohol of not less than one volume capacity, Four pesos (₱4.00);
hundred eighty degrees (180°) proof (ninety percent
(90%) absolute alcohol) shall be deemed to have been "(h) Kerosene, per liter of volume capacity, Four pesos
removed for motive power, unless shown otherwise; (₱4.00): Provided, That kerosene, when used as
aviation fuel, shall be subject to the same tax on
"(e) Naphtha, regular gasoline, pyrolysis gasoline, and aviation turbo jet fuel under the preceding paragraph
other similar products of distillation, per liter of volume (g), such tax to be assessed on the user thereof;
capacity, Nine pesos (₱9.00): Provided, however, That
 30

"(i) Diesel fuel oil, and on similar fuel oils having more preparations, and additives for lubricating oils and
or less the same generating power, per liter of volume greases, whether such additives are petroleum based
capacity, Four pesos and fifty centavos (₱4.50); or not, per liter and kilogram, respectively, of volume
capacity or weight, Ten pesos (₱10.00): Provided, That
"(j) Liquefied petroleum gas, per kilogram, Two lubricating oils and greases produced from basestocks
pesos(₱2.00): Provided, That liquefied petroleum gas and additives on which the excise tax has already been
when used as raw material in the production of paid shall no longer be subject to excise tax: Provided,
petrochemical products, subject to the rules and further, That locally produced or imported oils
regulations to be promulgated by the Secretary of previously taxed as such but are subsequently
Finance, per kilogram, zero (₱0.00): Provided, reprocessed, rerefined or recycled shall likewise be
finally, That liquefied petroleum gas used for motive subject to the tax imposed under this Subsection.
power shall be taxed at the equivalent rate as the
excise tax on diesel fuel oil; "(b) Processed gas, per liter of volume capacity, Ten
pesos (₱10.00);
"(k) Asphalts, per kilogram, Nine pesos (₱9.00);
"(c) Waxes and petrolatum, per kilogram, Ten pesos
"(l) Bunker fuel oil, and on similar fuel oils having more (₱10.00);
or less the same generating power, per liter of volume
capacity, Four pesos and fifty centavos "(d) On denatured alcohol to be used for motive
(₱4.50): Provided, however, That the excise taxes paid power, per liter of volume capacity, Ten pesos
on the purchased basestock (bunker) used in the (₱10.00): Provided, That unless otherwise provided by
manufacture of excisable articles and forming part special laws, if the denatured alcohol is mixed with
thereof shall be credited against the excise tax due gasoline, the excise tax on which has already been
therefrom; and paid, only the alcohol content shall be subject to the
tax herein prescribed. For purposes of this Subsection,
"(m) Petroleum coke, per metric ton, Four pesos and the removal of denatured alcohol of not less than one
fifty centavos (₱4.50): Provided, however, That, hundred eighty degrees (180°) proof (ninety percent
petroleum coke, when used as feedstock to any power (90%) absolute alcohol) shall be deemed to have been
generating facility, per metric ton, zero (₱0.00). removed for motive power, unless shown otherwise;

"Effective January 1, 2020 "(e) Naphtha, regular gasoline, pyrolysis gasoline and
other similar products of distillation, per liter of volume
"(a) Lubricating oils and greases, including but not capacity, Ten pesos (₱10.00): Provided, however, That
limited to, basestock for lube oils and greases, high naphtha and pyrolysis gasoline, when used as a raw
vacuum distillates, aromatic extracts and other similar material in the production of petrochemical products,
or in the refining of petroleum products or as
 31

replacement fuel for natural-gas-fired-combined cycle "(j) Liquefied petroleum gas, per kilogram, Three pesos
power plant in lieu of locally-extracted natural gas (₱3.00): Provided, That liquefied petroleum gas when
during the non-availability thereof, subject to the rules used as raw material in the production of
and regulations to be promulgated by the Secretary of petrochemical products, subject to the rules and
Finance, per liter of volume capacity, zero regulations to be promulgated by the Secretary of
(₱0.00): Provided, further, That the production of Finance, per kilogram, zero (₱0.00): Provided,
petroleum products, whether or not they are classified finally, That liquefied petroleum gas used for motive
as products of distillation and for use solely for the power shall be taxed at the equivalent rate as the
production of gasoline shall be exempt from excise excise tax on diesel fuel oil;
tax: Provided, finally, That the by-product including fuel
oil, diesel fuel, kerosene, pyrolysis gasoline, liquefied "(k) Asphalts, per kilogram, Ten pesos (₱10.00);
petroleum gases and similar oils having more or less
the same generating power, which are produced in the "(l) Bunker fuel oil, and on similar fuel oils having more
processing of naphtha into petrochemical products or less the same generating power, per liter of volume
shall be subject to the applicable excise tax specified in capacity, Six pesos (₱6.00): Provided, however, That
this Section, except when such by-products are the excise taxes paid on the purchased basestock
transferred to any of the local oil refineries through (bunker) used in the manufacture of excisable articles
sale, barter or exchange, for the purpose of further and forming part thereof shall be credited against the
processing or blending into finished products which are excise tax due therefrom; and
subject to excise tax under this Section;
"(m) Petroleum coke, per metric ton, Six pesos
"(f) Unleaded premium gasoline, per liter of volume (₱6.00): Provided, however, That, petroleum coke,
capacity, Ten pesos (₱10.00); when used as feedstock to any power generating
facility, per metric ton, zero (₱0.00).
"(g) Aviation turbojet fuel, aviation gas, per liter of
volume capacity, Four pesos (₱4.00); "Petroleum products, including naphtha, LPG, petroleum coke, refinery
fuel and other products of distillation, when used as input, feedstock or
"(h) Kerosene, per liter of volume capacity, Five pesos as raw material in the manufacturing of petrochemical products, or in
(₱5.00): Provided, That kerosene, when used as the refining of petroleum products, or as replacement fuel for natural-
aviation fuel, shall be subject to the same tax on gas-fired-combined cyclepower plant in lieu of locally-extracted natural
aviation turbo jet fuel under the preceding paragraph gas during the non-availability thereof, subject to the rules and
(g), such tax to be assessed on the user thereof; regulations to be promulgated by the Secretary of Finance, per liter of
volume capacity, zero (₱0.00): Provided, That the by-product including
"(i) Diesel fuel oil, and on similar fuel oils having more fuel oil, diesel fuel, kerosene, pyrolysis gasoline, liquefied petroleum
or less the same generating power, per liter of volume gases, and similar oils having more or less the same generating power,
capacity, Six pesos (₱6.00); which are produced in the processing of naphtha into petrochemical
 32

products shall be subject to the applicable excise tax specified in this "(a) Official Markers. - There shall be a list of chemical
Section, except when such by-products are transferred to any of the additives and corresponding quantitative ratio as
local oil refineries through sale, barter or exchange, for the purpose of identified by the Secretary of Finance as official fuel
further processing or blending into finished products which are subject markers. The official fuel markers shall be .distinct and,
to excise tax under this Section. to the greatest degree possible, impossible to imitate
or replicate: Provided, That the official fuel marker
"For the period covering 2018 to 2020, the scheduled increase in the must be unique to the Philippines and that its chemical
excise tax on fuel as imposed in this Section shall be suspended when composition and quantitative ratio must persist for at
the average Dubai crude oil price based on Mean of Platts Singapore least three (3) years from their application or
(MOPS)for three (3) months prior to the scheduled increase of the administration to the unmarked fuel;
month reaches or exceeds Eighty dollars (USD 80) per barrel.
"(b) The person, entity, or taxpayer who owns or
"Provided, That the Department of Finance shall perform an annual enters the petroleum products into the country, or the
review of the implementation of the excise tax on fuel and shall, based person to whom the petroleum products are consigned
on projections provided and recommendations of the Development shall cause and accommodate the marking of the
Budget Coordination Committee, as reconciled from the conditions as petroleum products with the official marking agent;
provided above, recommend the implementation or suspension of the
excise tax on fuel: Provided, further, That the recommendation shall be "(c) Internal revenue or customs officers shall be on
given on a yearly basis: Provided, finally, That any suspension of the site to administer the declaration of the tax and duties
increase in excise tax shall not result in any reduction of the excise tax imposed on the petroleum products and to oversee
being imposed at the time of the suspension." the application of the fuel marking;

Section 44. A new section designated as Section 148-A under Chapter V "(d) Absence of Official or Dilution of the Official
of the NIRC, as amended, is hereby inserted to read as follows: Marker; Presumptions.— In the event that the
petroleum products which do not contain the official
"Sec. 148-A. Mandatory Marking of All Petroleum Products. - In marker or which contain the official marker but are
accordance with rules and regulations to be issued by the Secretary of diluted beyond the acceptable percentage approved by
Finance, in consultation with the Commissioner of Internal Revenue and the Secretary of Finance are found in the domestic
Commissioner of Customs and in coordination with the Secretary of market or in the possession of anyone, or under any
Energy, the Secretary of Finance shall require the use of an official fuel situation where said petroleum products are subject to
marking or similar technology on petroleum products that are refined, duties and taxes, it shall be presumed that the same
manufactured, or imported into the Philippines, and that are subject to were withdrawn with the intention to evade the
the payment of taxes and duties, such as but not limited to, unleaded payment of the taxes and duties due thereon;
premium gasoline, kerosene, and diesel fuel oil after the taxes and
duties thereon have been paid. The mandatory marking of all petroleum "(e) The use of fraudulent marker on the petroleum
products shall be in accordance with the following: products shall be considered prima facie evidence that
 33

the same have been withdrawn or imported without "(i) The marking of petroleum products shall be
the payment of taxes and duties due thereon; mandatory within five (5) years from the effectivity of
this Act; and
"(f) Engagement of Fuel Marking Provider.— The
government shall engage only one fuel marking "(j) The term ‘random field test’ shall refer to periodic
provider who shall, under the supervision and direction random inspections and tests performed to establish
of the Commissioners of Internal Revenue and qualitative and quantitative positive result of fuel
Customs, be responsible for providing, monitoring, and trafficking, which are conducted on fuels found in
administering the fuel markers, provide equipment and warehouses, storage tanks, gas stations and other
devices, conduct field and confirmatory tests, and retail outlets, and in such other properties or
perform such other acts incidental or necessary to the equipment, including mechanisms of transportation, of
proper implementation of the provisions of this persons engaged in the sale, delivery, trading,
Act: Provided, That the fuel marking provider shall transportation, distribution, or importation of fuel
provide an end-to-end solution to the Government, intended for domestic market.
including the establishment and operation of testing
facilities that are certified to ISO 17025; "The term ‘confirmatory tests’ shall refer to the accurate and precise
analytical test of the tested unmarked, adulterated, or diluted fuel using
"(g) All costs pertaining to the procurement of the a device, tool or equipment which will validate and confirm the result of
official fuel markers shall be borne by the refiner, the field test, that is immediately conducted in an accredited testing
manufacturer or importer, of petroleum products, as facility that is certified to ISO 17025."
the case may be: Provided, That the government may
subsidize the cost of official fuel markers in the first Section 45. Section 149, Chapter 6 of Title VI of the NIRC, as amended, is
year of implementation; hereby further amended to read as follows:

"(h) Fuel Marking Program Funds. - In addition to any "CHAPTER VI – EXCISE TAX ON MISCELLANEOUS ARTICLES
appropriation to implement this Section and the last
paragraph of Section 171 of this Act, fees or charges "Sec. 149. Automobiles. - There shall be levied, assessed and collected
collected in relation to the fuel marking program may an ad valorem tax on automobiles based on the manufacturer’s or
be recorded as trust receipts of the implementing importer’s selling price, net of excise and value-added tax, in
agencies, and shall be exclusively disbursed to defray accordance with the following schedule:
the cost of services or equipment required to fully
implement the said program, subject to rules and "Effective January 1, 2018
regulations to be issued by the DOF-DBM-COA
permanent committee;
"Net manufacturer’s price/importer‘s selling price Rate
 34

"Up to Six hundred thousand pesos (₱600,000) Four percent (4%)new single cab chassis or cowl chassis and locally
customized rear body that has continuous sideway row
"Over Six hundred thousand pesos (₱600,000) to One million pesos Ten percent (10%)seats with open rear door and without retractable glass
(₱1,000,000) windows.

"Over One million pesos (₱1,000,000) to Four million pesos (₱4,000,000) Twenty percent(20%)
"(d) Bus shall mean a motor vehicle of any
configuration with gross vehicle weight of 4.0 tons or
"Over Four million pesos (₱4,000,000) Fifty percent (50%)
more with any number of wheels and axles, which is
generally accepted and specially designed for or public
"Provided, That hybrid vehicles shall be subject to fifty percent (50%) of transportation.
the applicable excise tax rates on automobiles under this
Section: Provided, further, That purely electric vehicles and pick-ups "(e) Single cab chassis shall mean a motor vehicle with
shall be exempt from excise tax on automobiles. complete engine power train and chassis equipped
with a cab that has a maximum of two (2) doors and
"As used in this Section— only one (1) row of seats.

"(a) Automobile shall mean any four (4) or more "(f) Special purpose vehicle shall mean a motor vehicle
wheeled motor vehicle regardless of seating capacity, designed for specific applications such as cement
which is propelled by gasoline, diesel, electricity or any mixer, fire truck, boom truck, ambulance and/or
other motive power: Provided, That for purposes of medical unit, and off-road vehicles for heavy industries
this Act, buses, trucks, cargo vans, jeepneys/jeepney and not for recreational activities.
substitutes, single cab chassis, and special-purpose
vehicles shall not be considered as automobiles. "(g) Hybrid electric vehicle shall mean a motor vehicle
powered by electric energy, with or without provision
"(b) Truck/cargo van shall mean a motor vehicle of any for off-vehicle charging, in combination with gasoline,
configuration that is exclusively designed for the diesel or any other motive power: Provided, That, for
carriage of goods and with any number of wheels and purposes of this Act, a hybrid electric vehicle must be
axles: Provided, That pick-ups shall be considered as able to propel itself from a stationary condition using
trucks. solely electric motor.

"(c) Jeepney/jeepney substitutes shall mean as "Provided, That in the case of imported automobiles not for sale, the tax
‘Philippine jeep or jeepney’ which are of the jitney type imposed herein shall be based on the total landed value, including
Jocally designed and manufactured generally from transaction value, customs duty and all other charges.
surplus parts and components. It shall also include
jeepney substitutes that are manufactured from brand-
 35

"Automobiles used exclusively within the freeoort zone shall be exempt beverages using purely coconut sap sugar and purely
from. excise tax." steviol glycosides shall be exempt from this tax; and

Section 46. A new section designated as Section 150-A under Chapter VI, "(2) A tax of Twelve pesos (₱12.00) per liter of volume
Title VI of the NIRC, as amended, is hereby inserted to read as follows: capacity shall be levied, assessed, and collected on
sweetened beverages using purely high fructose corn
"Sec. 150-A. Non-essential Services.— There shall be levied, assessed, syrup or in combination with any caloric or non-caloric
and collect a tax equivalent to five percent (5%) based on the gross sweetener.
receipts derived from the performance of services, net of excise tax and
value-added tax, on invasive cosmetic procedures, surgeries, and body "(B) Definition of Terms. - As used in this Act:
enhancements directed solely towards improving, altering, or enhancing
the patient’s appearance and do not meaning fully promote the proper "(1) Sweetened beverages (SBs) refer to non-alcoholic
function of the body or prevent or treat illness or beverages of any constitution (liquid, powder, or
disease: Provided, That this tax shall not apply to procedures necessary concentrates) that are pre-packaged and sealed in
to ameliorate a deformity arising from, or directly related to, a accordance with the Food and Drug Administration
congenital or developmental defect or abnormality, a personal injury (FDA) standards, that contain caloric and/or non-
resulting from an accident or trauma, or disfiguring disease, tumor, virus caloric sweeteners added by the manufacturers, and
or infection: Provided, further, That cases or treatments covered by the shall include, but not be limited to the following, as
National Health Insurance Program shall not be subject to this tax." described in the Food Category System from Codex
Alimentarius Food Category Descriptors (Codex Stan
Section 47. A new section designated as Section 150-B under Chapter VI, 192-1995, Rev. 2017 or the latest) as adopted by the
Title VI of the NIRC, as amended, is hereby inserted to read as follows: FDA:

"Sec. 150-B. Sweetened Beverages - "(a) Sweetened juice drinks;

"(A) Rate and Base of Tax. - Effective January 1, 2018: "(b) Sweetened tea;

"(1) A tax of Six pesos (₱6.00) per liter of volume "(c) All carbonated beverages;
capacity shall be levied, assessed, and collected on
sweetened beverages using purely caloric sweeteners, "(d) Flavored water;
and purely non-caloric sweeteners, or a mix of caloric
and non-caloric sweeteners: Provided, That this tax "(e) Energy and sports drinks;
rate shall not apply to sweetened beverages using high
fructose corn syrup: Provided, further, That sweetened "(f) Other powdered drinks not classified as
milk, juice, tea, and coffee;
 36

"(g) Cereal and grain beverages; and "(2) One Hundred Percent (100%) Natural Fruit Juices -
Original liquid resulting from the pressing of fruit, the
"(h) Other non-alcoholic beverages that liquid resulting from the reconstitution of natural fruit
contain added sugar. juice concentrate, or the liquid resulting from the
restoration of water to dehydrated natural fruit juice
"(2) Caloric sweetener refers to a substance that is that do not have added sugar or caloric sweetener;
sweet and includes sucrose, fructose, and glucose that
produces a certain sweetness; "(3) One Hundred Percent (100%) Natural Vegetable
Juices - Original liquid resulting from the pressing of
"(3) High fructose corn syrup refers to a sweet vegetables, the liquid resulting from the reconstitution
saccharide mixture containing fructose and glucose of natural vegetable juice concentrate, or the liquid
which is derived from corn and added to provide resulting from the restoration of water to dehydrated
sweetness to beverages, and which includes other natural vegetable juice that do not have added sugar
similar fructose syrup preparations; and or caloric sweetener;

"(4) Non-caloric sweetener refers to a substance that "(4) Meal Replacement and Medically Indicated
are artificially or chemically processed that produces a Beverages - Any liquid or powder drink/product for oral
certain sweetness. These are substances which can be nutritional therapy for persons who cannot absorb or
directly added to beverages, such as aspartame, metabolize dietary nutrients from food or beverages,
sucralose, saccharin, acesulfame, potassium, neotame, or as a source of necessary nutrition used due to a
cyclamates and other non-nutritive sweeteners medical condition and an oral electrolyte solution for
approved by the Codex Alimentarius and adopted by infants and children formulated to prevent dehydration
the FDA. due to illness; and

"(C) Exclusions. - The following products, as described in the food "(5) Ground coffee, instant soluble coffee, and pre-
category system from Codex Alimentarius Food Category Descriptors packaged powdered coffee products.
(Codex Stan 192-1995, Rev. 2017 or the latest) as adopted by the FDA,
are excluded from the scope of this Act: "(D) Filing of Return and Payment of Excise Tax and Penalty -

"(1) All milk products, including plain milk, infant "(1) Filing of Return and Payment of Excise Tax on
formula milk, follow-on milk, growing up milk, Domestic and Imported Sweetened Beverages. - The
powdered milk, ready-to-drink milk and flavored milk, provision of Sections 130 and 131 of the NIRC, as
fermented milk, soymilk, and flavored soymilk; appropriate, shall apply to sweetened beverages.
 37

"(2) Penalty. - Upon final findings by the Commissioner compliance with the requirements of this Section. Violations of the
of Internal Revenue and/or Customs that any provisions of this Act, including but not limited to, mislabeling or
manufacturer or importer, in violation of this Section, misbranding, shall, to the extent applicable, be punishable under
misdeclares or misrepresents in the sworn statement existing laws.
provided in Section 130(c) of the NIRC, as amended,
any pertinent data or information, the penalty of "(F) Duty of the Commissioner to Ensure Payment of Taxes. - It shall be
summary cancellation or withdrawal of the permit to the duty of the Commissioner, among other things, to prescribe a
engage in business as manufacturer or importer of materially unique, secure and non removable identification, such as
sweetened beverages as provided under Section 268 of codes, stamps or other markings, to be firmly and conspicuously affixed
the NIRC, as amended, shall be imposed. on and form part of the label of all excisable sweetened beverages.

"Any corporation, association or partnership liable for any of the acts or "For this purpose, the above mentioned control measure shall be
omissions in violation of this Section shall be fined treble the amount of caused by the Commissioner to be printed with adequate security
deficiency taxes, surcharges, and interest which may be assessed features to ensure the payment of excise tax on sweetened beverages.
pursuant to this Section.
"(G) Review of Implementation of the Sweetened Beverage Tax. - At the
"Any person liable for any of the acts or omissions prohibited under this start of the implementation of the sugar sweetened beverage tax and
Section. shall be crirninal1y liable and penalized under Section 254 of every year thereafter, the Department of Health, Department of Science
the NIRC, as amended. Any person who willfully aids or abets in the and Technology, and Department of Finance shall review the impact of
commission of any such act or omission shall be criminally liable in the these provisions on its health objectives with the view to making
same manner as the principal. recommendations on the tax rate on these beverages."

"If not a citizen of the Philippines, the offender shall be deported Section 48. Section 151 of the NIRC, as amended,is hereby further
immediately after serving the sentence without further proceedings for amended to read as follows:
deportation.
"Sec. 151. Mineral Products -
"(E) Specific Responsibility of the Food and Drug Administration (FDA). -
Starting June 1, 2018, the FDA shall require all manufacturers and "(A) Rates of Tax. - There shall be levied, assessed and
importers of sweetened beverages covered by this Act to indicate on collected on minerals, mineral products and quarry
the label the type of sweetener used, and on sweetened beverages in resources, excise tax as follows:
powder form to indicate on the label the equivalent of each serving per
liter of volume capacity. "(1) On domestic or imported coal and coke,
notwithstanding any incentives granted in any
"The FDA shall also conduct post marketing surveillance of the law or special law:
sweetened beverages on display in supermarkets, groceries or retail
stores and/or inspection of manufacturing sites to determine
 38

"Effective January 1, 2018, Fifty pesos (₱50.00) Section 49. Section 155 of the NIRC, as amended, is hereby further
per metric ton; amended to read as follows:

"Effective January 1, 2019, One hundred pesos "Sec. 155. Manufacturers and/or Importers to Provide Themselves with
(₱100.00) per metric ton; and Counting or Metering Devices to Determine Volume of Production and
Importation. - Manufacturers of cigarettes, alcoholic products, oil
"Effective January 1, 2020, One hundred fifty products, and other articles subject to excise tax that can be similarly
pesos {₱150.00) per metric ton. measured shall provide themselves with such necessary number of
suitable counting or metering devices to determine as accurately as
"(2) On all nonmetallic minerals and quarry possible the volume, quantity or number of the articles produced by
resources, a tax of four percent (4%) based on them under rules and regulations promulgated by the Secretary of
the actual market value of the gross output Finance, upon recommendation of the Commissioner: Provided, That
thereof at the time of removal, in the case of the Department of Finance shall maintain a registry of all petroleum
those locally extracted or produced; or the manufacturers and/or importers and the articles being manufactured
value used by the Bureau of Customs in and/or imported by them: Provided, further, That the Department of
determining tariff and customs duties, net of Finance shall mandate the creation of a real-time inventory of
excise tax and value-added tax in the case of petroleum articles being manufactured, imported or found in storage
importation. depots of such petroleum manufacturers and/or importers: Provided,
finally, That importers of finished petroleum products shall also provide
"x x x: themselves with Bureau-accredited metering devices to determine as
accurately as possible the volume of petroleum products imported by
"(a) Copper and other metallic them.
minerals, four percent (4%); and
This requirement shall be complied with before commencement of
"(b) Gold and chromite, four percent operations."
(4%).
Section 50. Section 171 of the NIRC, as amended, is hereby further
"(4) On indigenous petroleum, a tax of six amended to read as follows:
percent (6%) of the fair international market
price thereof, on the first taxable sale, barter, "Sec. 171. Authority of Internal Revenue Officer in Searching for and
exchange or such similar transaction, such tax Testing Taxable Articles. - Any internal revenue officer may, in the
to be paid by the buyer or purchaser before discharge of his official duties, enter any house, building or place where
removal from the place of production. x x x. articles subject to tax under this Title are produced or kept, or are
believed by him upon reasonable grounds to be produced or kept, so far
"x x x." as may be necessary to examine, test, discover or seize the same.
 39

"He may also stop and search any vehicle or other means of "Sec. 174. Stamp Tax on Original Issue of Shares of Stock. - On every
transportation when upon reasonable grounds he believes that the original issue, whether on organization, reorganization or for any lawful
same carries any article on which the excise tax has not been paid. purpose, of shares of stock by any association, company, or corporation;
there shall be collected a documentary stamp tax of Two pesos (₱2.00)
"Subject to rules and regulations to be issued by the Secretary of on each Two hundred pesos (₱200), or fractional part thereof, of the par
Finance, the Commissioner of Internal Revenue or his authorized value, of such shares of stock: Provided, That in the case of the original
representatives may conduct periodic random field tests and issue of shares of stock without par value, the amount of the
confirmatory tests on fuel required to be marked under Section 148-A documentary stamp tax herein prescribed shall be based upon the
found in warehouses, storage tanks, gas stations and other retail actual consideration for the issuance of such shares of stock: Provided,
outlets, and in such other properties of persons engaged in the sale, further, That in the case of stock dividends, on the actual value
delivery, trading, transportation, distribution, or importation of fuel represented by each share."
intended for the domestic market: Provided, "(a) Random field testing
shall be conducted in the presence of revenue or customs officers, fuel Section 52. Section 175 of the NIRC, as amended, is hereby further
marking provider, and the authorized representative of the owner of the amended to read as follows:
fuel to be tested: Provided, That an employee assigned or working at the
place where the random field tests conducted shall be deemed an "Sec. 175. Stamp Tax on Sales, Agreements to Sell, Memoranda of Sales,
authorized representative of the owner; Deliveries or Transfer of Shares or Certificates of Stock - On all sales, or
agreements to sell, or memoranda of sales, or deliveries, or transfer of
"(b) All field tests shall be properly filmed or video shares or certificates of stock in any association, company, or
taped, and documented; and corporation, or transfer of such securities by assignment in blank, or by
delivery, or by any paper or agreement, or memorandum or other
"(c) A sample of the randomly tested fuel shall be evidences of transfer or sale whether entitling the holder in any manner
immediately obtained by the revenue or customs to the benefit of such stock, or to secure the future payment of money,
officer upon discovering that the same unmarked, or for the future transfer of any stock, there shall be collected a
adulterated, or diluted: documentary stamp tax of One peso and fifty centavos (₱1.50) on each
Two hundred pesos (₱200), or fractional part thereof, of the par value
"Provided, further, That confirmatory fuel test certificates issued by fuel of such stock: Provided, That only one tax shall be collected on each sale
testing facilities shall be valid for any legal purpose from the date of or transfer of stock from one person to another, regardless of whether
issue, and shall constitute admissible and conclusive evidence before or not a certificate of stock is issued, indorsed, or delivered in pursuance
any court." of such sale or transfer: and Provided, further, That in the case of stock
without par value the amount of the documentary stamp tax herein
Section 51. Section 174 of the NIRC, as amended, is hereby further prescribed shall be equivalent to fifty percent (50%) of the documentary
amended to read as follows: stamp tax paid upon the original issue of said stock."

Section 53. Section 177 of the NIRC, as amended, is hereby further

amended to read as follows:
 40

"Sec. 177. Stamp Tax on Certificates of Profits or Interest in Property or Section 56. Section 180 of the NIRC, as amended, is hereby further
Accumulations. - On all certificates of profits, or any certificate or amended to read as follows:
memorandum showing interest in the property or accumulations of any
association, company or corporation, and on all transfers of such "Sec. 180. Stamp Tax on All Bills of Exchange or Drafts. - On all bills of
certificates or memoranda, there shall be collected a documentary exchange (between points within the Philippines) or drafts, there shall
stamp tax of One peso (₱1.00) on each Two hundred pesos (₱200), or be collected a documentary stamp tax of Sixty centavos (₱0.60) on each
fractional part thereof, of the face value of such certificates or Two hundred pesos (₱200), or fractional part thereof, of the face value
memorandum." of any such bill of exchange or draft."

Section 54. Section 178 of the NIRC, as amended, is hereby further Section 57. Section 181 of the NIRC, as amended, is hereby further
amended to read as follows: amended to read as follows:

"Sec. 178. Stamp Tax on Bank Checks, Drafts, Certificates of Deposit not "Sec. 180. Stamp Tax Upon Acceptance of Bills of Exchange and Others. -
Bearing Interest, and Other Instruments. - On each bank check, draft, or Upon any acceptance or payment of any bill of exchange or order for
certificate of deposit not drawing interest, or order for the payment of the payment of money purporting to be drawn in a foreign country but
any sum of money drawn upon or issued by any bank, trust company, payable in the Philippines, there shall be collected a documentary stamp
for any person or persons, companies or corporations, at sight or on tax of Sixty centavos (₱0.60) on each Two hundred pesos (₱200), or
demand there shall be collected a documentary stamp tax of Three fractional part thereof, of the face value of any such bill of exchange, or
pesos (₱3.00)." order, or the Philippine equivalent of such value, if expressed in foreign
currency."
Section 55. Section 179 of the NIRC, as amended. is hereby further
amended to read as follows: Section 58. Section 182 of the NIRC, as amended, is hereby further
amended to read as follows:
"Sec. 179. Stamp Tax on All Debt Instruments. - On every original issue
of debt instruments, there shall be collected a documentary stamp-tax "Sec. 182. Stamp Tax on Foreign Bills of Exchange and Letters of Credit. -
of One peso and fifty centavos (₱1.50) on each Two hundred pesos On all foreign bills of exchange and letter of credit (including orders, by
(₱200), or fractional part thereof, of the issue price of any such debt telegraph or otherwise, for the payment of money issued by express or
instruments: Provided, That for such debt instruments with terms of less steamship companies or by any person or persons) drawn in but payable
than one (1) year, the documentary stamp tax to be collected shall be of out of the Philippines in a set of three (3) or more according to the
a proportional amount in accordance with the ratio of its term in custom of merchants and bankers, there shall be collected a
number of days to three hundred sixty-five (365) days: Provided, documentary stamp tax of Sixty centavos (₱0.60) on each Two hundred
further, That only one documentary stamp tax shall be imposed on pesos (₱200), or fractional part thereof, of the face value of any such bill
either loan agreement, or promissory notes issued to secure such loan. of exchange or letter of credit, or the Philippine equivalent of such face
value, if expressed in foreign
"x x x."
 41

Section 59. Section 183 of the NIRC, as amended, is hereby further centavos (₱0.40) on each Two hundred pesos (₱200), or fractional part
amended to read as follows: thereof of the premium or contribution collected."

"Sec. 183. Stamp Tax on Life Insurance Policies.— On all policies of Section 61. Section 188 of the NIRC, as amended, is hereby further
insurance or other instruments by whatever name the same may be amended to read as follows:
called, whereby any insurance shall be made or renewed upon any life
or lives, there shall be collected a one-time documentary stamp tax at "Sec. 188. Stamp Tax on Certificates. - On each certificate of damage or
the following rates: otherwise, and on every other certificate or document issued by any
customs officer, marine surveyor, or other person acting as such, and on
each certificate issued by a notary public, and on each certificate of any
"If the amount of insurance does not exceed ₱100,000 Exempt
description required by law or by rules or regulations of a public office,
"If the amount of Insurance exceeds ₱100,000 but or which is issued for the purpose of giving information, or establishing
₱20.00 proof of a fact, and not otherwise specified herein, there shall be
does not exceed ₱300,000
collected a documentary stamp tax of Thirty pesos (₱30.00)."
"If the amount of insurance exceeds ₱300,000 but
₱50.00 Section 62. Section 189 of the NIRC, as amended, is hereby further
does not exceed ₱500,000
amended to read as follows:
"If the amount of insurance exceeds ₱500,000 but
₱100.00
does not exceed ₱750,000 "Sec. 189. Stamp Tax on Warehouse Receipts. - On each warehouse
receipt for property held in storage in a public or private warehouse or
"If the amount of insurance exceeds ₱750,000 but yard for any person other than the proprietor of such warehouse or
₱150.00
does not exceed ₱1,000,000 yard, there shall be collected a documentary stamp tax of Thirty pesos
(₱30.00): Provided, That no tax shall be collected on each warehouse
"If the amount of insurance exceeds ₱1,000,000 ₱200.00" receipt issued to any one person in any one calendar month covering
property the value of which does not exceed Two hundred pesos
Section 60. Section 186 of the NIRC, as amended, is hereby further (₱200)."
amended to read as follows:
Section 63. Section 190 of the NIRC, as amended, is hereby further
"Sec. 186. Stamp Tax on Policies ofAnnuities and Pre-Need Plans. - On all amended to read as follows:
policies of annuities, or other instruments by whatever name the same
may be called, whereby an annuity may be made, transferred or "Sec. 190. Stamp Tax on Jai-alai, Horse Race, Tickets, Lotto or Other
redeemed, there shall be collected a documentary stamp tax of One Authorized Numbers Games. - On each jai-alai, horse race ticket, lotto,
peso (₱1.00) on each Two hundred pesos (₱200), or fractional part or other authorized numbers games, there shall be collected a
thereof, of the premium or installment payment on contract price documentary stamp tax of Twenty centavos (₱0.20): Provided, That if
collected. On pre-need plans, the documentary stamp tax shall be Forty the cost of the ticket exceed One peso (₱1.00), an additional tax of
 42

Twenty centavos (₱0.20) on every One peso (₱1.00), or fractional part municipality, there shall be collected a documentary stamp tax of Ten
thereof, shall be collected." pesos (₱10.00)."

Section 64. Section 191 of the same Code, as amended, is hereby further Section 67. Section 194 of the NIRC, as amended, is hereby further
amended to read as follows: amended to read as follows:

"Sec. 191. Stamp Tax on Bills of Lading or Receipts. - On each set of bills "Sec. 194. Stamp Tax on Leases and Other Hiring Agreements. - On each
of lading or receipts (except charter party) for any goods, merchandise lease, agreement, memorandum, or contract for hire, use or rent of any
or effects shipped from one port or place in the Philippines (except on lands or tenements, or portions thereof, there shall be collected a
ferries across rivers), or to any foreign port, there shall be collected a documentary stamp tax of Six pesos (₱6.00) for the first Two thousand
documentary stamp tax of Two pesos (₱2.00), if the value of such goods pesos (₱2,000), or fractional part thereof, and an additional Two pesos
exceeds One hundred pesos (₱100) and does not exceed One thousand (₱2.00) for every One thousand pesos (₱1,000) or fractional part
pesos (₱1,000); Twenty pesos (₱20.00), if the value exceeds One thereof, in excess of the first Two thousand pesos (₱2,000) for each year
thousand pesos (₱1,000): Provided, however, That freight tickets of the term of said contract or agreement."
covering goods, merchandise or effects carried as accompanied baggage
of passengers on land and water carriers primarily engaged in the Section 68. Section 195 of the NIRC, as amended, is hereby further
transportation of passengers are hereby exempt." amended to read as follows:

Section 65. Section 192 of the NIRC, as amended, is hereby further "Sec. 195. Stamp Tax on Mortgages, Pledges and Deeds of Trust. - On
amended to read as follows: every mortgage or pledge of lands, estate, or property, real or personal,
heritable or movable, whatsoever, where the same shall be made as a
"Sec. 192. Stamp Tax on Proms. - On each proxy for voting at any security for the payment of any definite and certain sum of money lent
election of officers of any company or association, or for any other at the time or previously due and owing or forborne to be paid, being
purpose, except proxies issued affecting the affairs of associations or payable, and on any conveyance of land, estate, or property
corporations organized for religious, charitable or literary purposes, whatsoever, in trust or to be sold, or otherwise converted into money
there shall be collected a documentary stamp tax of Thirty pesos which shall be and intended only as security, either by express
(₱30.00)." stipulation or otherwise, there shall be collected a documentary stamp
tax at the following rates:
Section 66. Section 193 of the NIRC, as amended, is hereby further
amended to read as follows: "(a) When the amount secured does not exceed Five thousand pesos
(₱5,000), Forty pesos (₱40.00).
"Sec. 193. Stamp Tax on Powers of Attorney. - On each power of
attorney to perform any act whatsoever, except acts connected with the "(b) On each Five thousand pesos (₱5,000), or fractional part thereof in
collection of claims due from or accruing to the Government of the excess of Five thousand pesos (₱5,000), an additional tax of Twenty
Republic of the Philippines, or the government of any province, city or pesos (₱20.00).
 43

"x x x." consideration in any conveyance, deed, instrument or writing subject to

such tax the Commissioner, provincial or city Treasurer, or other
Section 69. Section 196 of the NIRC, as amended, is hereby further revenue officer shall. from the assessment rolls or other reliable source
amended to read as follows: of information, assess the property of its true market value and collect
the proper tax thereon."
"Sec. 196. Stamp Tax on Deeds of Sale, Conveyances and Donation of
Real Property. - On all conveyances, donations, deeds, instruments, or Section 70. Section 197 of the NIRC, as amended, is hereby further
writings, other than grants, patents or original certificates of amended to read as follows:
adjudication issued by the Government, whereby any land, tenement,
or other realty sold shall be granted, assigned, transferred, donated or "Sec. 197. Stamp Tax on Charter Parties and Similar Instruments. - On
otherwise conveyed to the purchaser, or purchasers, or to any other every charter party, contract or agreement for the charter of any ship,
person or persons designated by such purchaser or purchasers, or vessel or streamer, or any letter or memorandum or other writing
donee, there shall be collected a documentary stamp tax, at the rates between the captain, master or owner or other person acting as agent
herein below prescribed, based on the consideration contracted to be of any ship, vessel or steamer, and any other person or persons for
paid for such realty or on its fair market value determined in accordance relating to the charter of any such ship, vessel or streamer, and on any
with Section 6(E) of this Code, whichever is higher: Provided, That when renewal or transfer of such charter, contract, agreement, letter or
one of the contracting parties is the Government, the tax herein memorandum there shall be collected a documentary stamp tax the
imposed shall be based on the actual consideration: following rates:

"(a) When the consideration, or value received or "(a) If the registered gross tonnage of the ship, vessel
contracted to be paid for such realty, after making or steamer does not exceed one thousand (1,000)
proper allowance of any encumbrance, does not tons, and the duration of the charter or contract does
exceed One thousand pesos (₱1,000), Fifteen pesos not exceed six (6) months, One thousand pesos
(₱15.00). (₱1,000); and for each month or fraction of a month in
excess of six (6) months, an additional tax of One
"(b) For each additional One thousand pesos (₱1,000), hundred pesos (₱100) shall be paid.
or fractional part thereof in excess of One thousand
pesos (₱1,000) of such consideration or value, Fifteen "(b) If the registered gross tonnage exceeds one
pesos (₱15.00). thousand (1,000) tons and does not exceed ten
thousand (10,000) tons, and the duration of the
"Transfers exempt from donor’s tax under Section 101(a) and (b) of this charter or contract does not exceed six (6) months,
Code shall be exempt from the tax imposed under this Section. Two thousand pesos (₱2,000); and for each month or
fraction of a month in excess of six (6) months, an
"When it appears that the amount of the documentary stamp tax additional tax of Two hundred pesos (₱200) shall be
payable hereunder has been reduced by an incorrect statement of the paid.
 44

"(c) If the registered gross tonnage exceeds ten "Sec. 236. Registration Requirements -
thousand (10,000) tons and the duration of the charter
or contract does not exceed six (6) months, Three "(A) Requirements. - x x x
thousand pesos (₱3,000); and for each month or
fraction of a month in excess of six (6) months, an "x x x
additional tax of Three hundred pesos (₱300) shall be
paid." "The registration shall contain the taxpayer’s name,
style, place of residence, business, and such other
Section 71. Section 232 of the NIRC, as amended, is hereby further information as may be required by the Commissioner
amended to read as follows: in the form prescribed therefor: Provided, That the
Commissioner shall simplify the business registration
"Sec. 232. Keeping of Books of Accounts.— and tax compliance requirements of self-employed
individuals and/or professionals.
"(A) Corporations, Companies, Partnerships or Persons Required to Keep
Books of Accounts.— All corporations, companies, partnerships or "x x x
persons required by law to pay internal revenue taxes shall keep and
use relevant and appropriate set of bookkeeping records duly "(G) Persons Required to Register for Value-Added Tax -
authorized by the Secretary of Finance wherein all transactions and
results of operations are shown and from which all taxes due the "(1) x x x
Government may readily and accurately be ascertained and determined
any time of the year: Provided, That corporations, companies, "(a) His gross sales or receipts for the
partnerships or persons whose gross annual sales, earnings, receipts or past twelve (12) months, other than
output exceed Three million pesos (₱3,000,000), shall have their books those that are exempt under Section
of accounts audited and examined yearly by independent Certified 109(A) to (BB), have exceeded Three
Public Accountants and their income tax returns accompanied with a million pesos (₱3,000,000); or
duly accomplished Account Information Form (AIF) which shall contain,
among others, information lifted from certified balance sheets, profit
"(b) There are reasonable grounds to
and loss statements, schedules listing income-producing properties and
believe that his gross sales or receipts
the corresponding income therefrom and other relevant statements.
for the next twelve (12) months,
other than those that are exempt
"x x x." under Section 109(A) to (BB), will
exceed Three million pesos
Section 72. Section 236 of the NIRC, as amended, is hereby further (₱3,000,000).
amended to read as follows:
"x x x
 45

"(H) Optional Registration for Value-Added Tax of nature of service: Provided, however, That where the receipt is issued to
Exempt Person. - (1) Any person who is not required to cover payment made as rentals, commissions, compensation or fees,
register for value-added tax under Subsection (G) receipts or invoices shall be issued which shall show the name, business
hereof may elect to register for value-added tax by style, if any, and address of the purchaser, customer or client: Provided,
registering with the Revenue District Office that has further, That where the purchaser is a VAT-registered person, in
jurisdiction over the head office of that person, and addition to the information herein required, the invoice or receipt shall
paying the annual registration fee in Subsection (B) further show the Taxpayer Identification Number (TIN) of the purchaser.
hereof.
"Within five (5)years from the effectivity of this Act and upon the
"(2) Any person who elects to register under establishment of a system capable of storing and processing the
this Subsection shall not be entitled to cancel required data. the Bureau shall require taxpayers engaged in the export
his registration under Subsection (F)(2) for the of goods and services, taxpayers engaged in e-commerce, and taxpayers
next three (3) years. under the jurisdiction of the Large Taxpayers Service to issue electronic
receipts or sales or commercial invoices in lieu of manual receipts or
"Provided, That any person taxed under Section 24(A)(2)(b) and sales or commercial invoices subject to rules and regulations to be
24(A)(2)(c)(2)(a) of the NIRC who elected to pay the eight percent (8%) issued by th; Secretary of Finance upon recommendation of the
tax on gross sales or receipts shall not be allowed to avail of this option. Commissioner and after a public hearing shall have been held for this
purpose: Provided, That taxpayers not covered by the mandate of this
"For purposes of Title IV of this Code, any person who has registered provision may issue electronic receipts or, sales or commercial invoices,
value-added tax as a tax type in accordance with the provisions of in lieu of manual receipts, and sales and commercial invoices.
Subsection (C) hereof shall be referred to as a ‘VAT-registered person’
who shall be assigned only one Taxpayer Identification Number (TIN). "The original of each receipt or invoice shall be issued to the purchaser,
customer or client at the time the transaction is effected, who, if
"x x x." engaged in business or in the exercise of profession, shall keep and
preserve the same in his place of business for a period of three (3) years
Section 73. Section 237 of the NIRC, as amended, is hereby further from the close of the taxable year in which such invoice or receipt was
amended to read as follows: issued, while the duplicate shall be kept and preserved by the issuer,
also in his place of business, for a like period: Provided, That in case of
"Sec. 237. Issuance of Receipts or Sales or Commercial Invoices.— electronic receipts or sales or commercial invoices, the digital records of
the same shall be kept by the purchaser, customer or client and the
issuer for the same period above stated.
"(A) Issuance. - All persons subject to an internal revenue tax shall, at
the point of each sale and transfer of merchandise or for services
rendered valued at One hundred pesos (₱100) or more, issue duly "The Commissioner may, in meritorious cases, exempt any person
registered receipts or sale or commercial invoices, showing the date of subject to internal revenue tax from compliance with the provisions of
transaction, quantity, unit cost and description of merchandise or this Section."
 46

Section 74. A new section designated as Section 237-A under Chapter II, as set by the Bangko Sentral ng Pilipinas from the date
Title IX of the NIRC, as amended, is hereby inserted to read as follows: prescribed for payment until the amount is fully
paid: Provided, That in no case shall the deficiency and
"Sec. 237-A. Electronic Sales Reporting System.— Within five (5) years the delinquency interest prescribed under Subsections
from the effectivity of this Act and upon the establishment of a system (B) and (C) hereof, be imposed simultaneously.
capable of storing and processing the required data, the Bureau shall
require taxpayers engaged in the export of goods and services, and "(B) Deficiency Interest - Any deficiency in the tax due,
taxpayers under the jurisdiction of the Large Taxpayers Service to as the term is defined in this Code, shall be subject to
electronically report their sales data to the Bureau through the use of the interest prescribed in Subsection (A) hereof, which
electronic point of sales systems, subject to rules and regulations to be interest shall be assessed and collected from the date
issued by the Secretary of Finance as recommended by the prescribed for its payment until the full payment
Commissioner of Internal Revenue: Provided, That the machines, fiscal thereof, or upon issuance of a notice and demand by
devices, and fiscal memory devices shall be at the expense of the the Commissioner of Internal Revenue, whichever
taxpayers. comes earlier.

"The data processing of sales and purchase data shall comply with the "(C) Delinquency Interest. - x x x
provisions of Republic Act No. 10173, otherwise known as the "Data
Privacy Act" and Section 270 of the NIRC, as amended, on unlawful "x x x."
divulgence of taxpayer information and such other laws relating to the
confidentiality of information. Section 76. Section 254 of the NIRC, as amended, is hereby further
amended to read as follows:
"The Bureau shall also establish policies, risk management approaches,
actions, trainings, and technologies to protect the cyber environment, "Sec. 254. Attempt to Evade or Defeat Tax. - Any person who willfully
organization, and data in compliance with Republic Act No. 10175 or attempts in any manner to evade or defeat any tax imposed under this
the "Cybercrime Prevention Act of 2012." Code or the payment thereof shall, in addition to other penalties
provided by law, upon conviction thereof, be punished with a fine of not
Section 75. Section 249 of the NIRC, as amended, is hereby further less than Five hundred thousand pesos (₱500,000) but not more than
amended to read as follows: Ten million pesos (₱10,000,000), and imprisonment of not less than six
(6) years but not more than ten (10) years: Provided, That the conviction
"Sec. 249. Interest - or acquittal obtained under this Section shall not be a bar to the filing of
a civil suit for the collection of taxes."
"(A) In General. - There shall be assessed and collected
on any unpaid amount of tax, interest at the rate of Section 77. Section 264 of the NIRC, as amended, is hereby further
double the legal interest rate for loans or forbearance amended to read as follows:
of any money in the absence of an express stipulation
 47

"Sec. 264. Failure or Refusal to Issue Receipts or Sales or Commercial closure of the taxpayer shall be imposed: Provided, further, That if the
Invoices, Violations Related to the Printing of such Receipts or Invoices failure to transmit is due to force majeure or any causes beyond the
and Other Violations - control of the taxpayer the penalty shall not apply."

"(a) x x x Section 79. A new section designated as Section 264-B under Chapter II,
Title X of the NIRC, as amended, is hereby inserted to read as follows:
"(b) Any person who commits any of the acts enumerated hereunder
shall be penalized with a fine of not less than Five hundred thousand "Sec. 264-B. Purchase, Use, Possession, Sale or Offer to Sell, Installment,
pesos (₱500,000) but not more than Ten million pesos (₱10,000,000), Transfer, Update, Upgrade, Keeping or Maintaining of Sales Suppression
and imprisonment of not less than six (6) years but not more than ten Devices.— Any person who shall purchase, use, possess, sell or offer to
(10) years: sell, install, transfer, update, upgrade, keep, or maintain any software or
device designed for, or is capable of: (a) suppressing the creation of
"(1) x x x; electronic records of sale transactions that a taxpayer is required to
keep under existing tax laws and/or regulations; or (b) modifying, hiding,
"(2) x x x; or deleting electronic records of sales transactions and providing a
ready means of access to them, shall be punished by a fine of not less
"(3) x x x; or than Five hundred thousand pesos (₱500,000) but not more than Ten
million pesos (₱10,000,000), and suffer imprisonment of not less than
"(4) Printing of other fraudulent receipts or sales or two (2) years but not more than four (4) years: Provided, That a
commercial invoices." cumulative suppression of electronic sales record in excess of the
amount of Fifty million pesos (₱50,000,000) shall be considered as
economic sabotage and shall be punished in the maximum penalty
Section 78. A new section designated as Section 264-A under Chapter II,
provided for under this provision."
Title X of the NIRC, as amended, is hereby inserted as follows:
Section 80. A new section designated as Section 265-A under Chapter II,
"Sec. 264-A. Failure to Transmit Sales Data Entered on Cash Register
Title X of the NIRC, as amended, is hereby inserted to read as follows:
Machine (CRM)/Point of Sales System (POS) Machines to the BIR’s
Electronic Sales Reporting System. - Any taxpayer required to transmit
sales data to the Bureau’s electronic sales reporting system but fails to "Sec. 265-A. Offenses Relating to Fuel Marking.— All offenses relating to
do so, shall pay, for each day of violation, a penalty amounting to one- fuel marking shall, in addition to the penalties imposed under Title X of
tenth of one percent (1⁄10 of 1%) of the annual net income as reflected the NIRC, as amended, Section 1401 of Republic Act No. 10863,
in the taxpayer’s audited financial statement for the second year otherwise known as the ‘Customs Modernization and Tariff Act
preceding the current taxable year for each day of violation or Ten (CMTA)’,and other relevant laws, be punishable as follows:
thousand pesos (₱10,000), whichever is higher: Provided, That should
the aggregate number of days of violation exceed one hundred eighty "(a) Any person who is found to be engaged in the sale,
(180) days within a taxable year, an additional penalty of permanent trade, delivery, distribution or transportation of
unmarked fuel in commercial quantity held for
 48

domestic use or merchandise shall, upon conviction, "(3) Causing another person or entity to
suffer the penalties of: commit any of the two (2) preceding acts; or

"(1) For the first offense, a fine of Two million "(4) Causing the sale, distribution, supply or
five hundred thousand pesos (₱2,500,000); transport of legitimately imported, in-transit,
manufactured or procured controlled
"(2) For the second offense, a fine of Five precursors and essential chemicals, in diluted,
million pesos (₱5,000,000); and mixtures or in concentrated form, to any
person or entity penalized in Subsections (a),
"(3) For the third offense,a fine of Ten million (b), or (c) hereof, including but not limited to,
pesos (₱10,000,000)and revocation of license packaging, repackaging, labeling, relabeling or
to engage in any trade or business. concealment of such transaction through
fraud, destruction of documents, fraudulent
"(b) Any person who causes the removal of the official use of permits, misdeclaration, use of front
fuel marking agent from marked fuel, and the companies or mail fraud.
adulteration or dilution of fuel intended for sale to the
domestic market, or the knowing possession, storage, "(d) Any person who willfully inserts, places, adds or
transfer or offer for sale of fuel obtained as a result of attaches directly or indirectly, through any overt or
such removal, adulteration or dilution shall be covert. act, whatever quantity of any unmarked fuel,
penalized in the same manner and extent as provided counterfeit additive or chemical in the person, house,
for in the preceding Subsection. effects, inventory, or in the immediate vicinity of an
innocent individual for the purpose of implicating,
"(c) Any person who commits any of the acts incriminating or imputing the commission of any
enumerated hereunder shall, upon conviction, be violation of this Act shall, upon conviction, be punished
punished by a fine of not less than One million pesos by a fine of not less than Five million pesos
(₱1,000,000) but not more than Five million pesos (₱5,000,000) but not more than Ten million pesos
(₱5,000,000), and suffer imprisonment of not less than (₱10,000,000), and suffer imprisonment of not less
four (4) years but not more than eight (8) years: than four (4) years but not more than eight (8) years.

"(1) Making, importing, selling, using or "(e) Any person who is authorized, licensed or
possessing fuel markers without express accredited under this Act and its implementing rules to
authority; conduct fuel tests, who issues false or fraudulent fuel
test results knowingly, willfully or through gross
"(2) Making, importing, selling, using or negligence, shall suffer the additional penalty of
possessing counterfeit fuel markers; imprisonment ranging from one (1) year and one (1)
day to two (2) years and six (6) months.
 49

"The additional penalties of revocation of the license to practice his usurpation of authority and habitual issuance of unreasonable
profession in case of a practitioner, and the closure of the fuel testing assessments.
facility, may also be imposed at the instance of the court."
Section 82. Section 288 of the NIRC, as amended, is hereby further
Section 81. Section 269 of the NIRC, as amended, is hereby further amended to read as follows:
amended to read as follows:
"Sec. 288. Disposition of Incremental Revenue -
"Sec. 269. Violations Committed by Government Enforcement Officers. -
xxx "(A) x x x

"(a) x x x; "(B) x x x

"x x x "(C) x x x

"(h) Having knowledge or information of any violation "(D) x x x

of this Code or of any fraud committed on the
revenues collectible by the Bureau of Internal Revenue, "(E) x x x
failure to report such knowledge or information to
then superior officer, or failure to report as otherwise "(F) Incremental Revenues from the Tax Reform for Acceleration
required by law; and Inclusion (TRAIN). - For five (5) years from the effectivity of
this Act, the yearly incremental revenues generated shall be
"(i) x x x; and automatically appropriated as follows:

"(j) Deliberate failure to act on the application for "(1) Not more than-seventy percent (70%) to fund
refunds within the prescribed period provided under infrastructure projects such as, but not limited to, the
Section 112 of this Act. Build, Build, Build Program and provide infrastructure
programs to address congestion through mass
"Provided, That the provisions of the foregoing paragraph transport and new road networks military
notwithstanding, any internal revenue officer for which a prima facie infrastructure, sports facilities for public schools, and
case of grave misconduct has been established shall, after due notice potable drinking water supply in all public places; and
and hearing of the administrative case and subject to Civil Service Laws,
be dismissed from the revenue service: Provided, further, That the term "(2) Not more than thirty percent (30%) to fund:
‘grave misconduct’, as defined in the Civil Service Law, shall include the
issuance of fake letters of authority and receipts, forgery of signature, "(a) Programs under Republic Act No. 10659
otherwise known as ‘Sugarcane Industry
 50

Development Act of 2015’, to advance the "(ii) Fuel vouchers to qualified

self-reliance of sugar farmers that will increase franchise holders of Public Utility
productivity, provide livelihood opportunities, Jeepneys (PUJs);
develop alternative farming systems and
ultimately enhance farmers’ income; "(iii)For minimum wage earners,
unemployed, and the poorest fifty
"(b) Social mitigating measures and percent (50%) of the population:
investments in: (i) education, (ii) health,
targeted nutrition, and anti-hunger programs "(1) Fare discount from all
for mothers infants, and young children, (iii) public utility vehicles (except
social protection, (iv) employment, and (v) trucks for hire and school
housing that prioritize and directly benefit transport service) in the
both the poor and near-poor households; amount equivalent to ten
percent (10%) of the
"(c) A social welfare and benefits program authorized fare;
where qualified beneficiaries shall be provided
with a social benefits card to avail of the "(2) Discounted purchase of
following social benefits: National Food Authority
(NFA) rice from accredited
"(i) Unconditional cash transfer to retail stores in the amount
households in the first to seventh equivalent to ten percent
income deciles of the National (10%) of the net retail prices,
Household Targeting System for up to a maximum of twenty
Poverty Reduction (NHTS-PR), (20) kilos per month; and
Pantawid Pamilyang Pilipino Program,
and the social pension program for a "(3) Free skills training under
period of three (3) years from the a program implemented by
effectivity of this Act: Provided, That the Technical Skills and
the unconditional cash transfer shall Development Authority
be Two hundred pesos (₱200.00) per (TESDA).
month for the first year and Three
hundred pesos (₱300.00) per month "Provided, That benefits or
for the second year and third-year, to grants contained in this
be implemented by the Department Subsection shall not be
of Social Welfare and Development availed in addition to any
(DSWD); other discounts.
 51

"(iv) Other social benefits programs to Section 83. Reportorial Requirements. - The interagency committee
be developed and implemented by created and the concerned departments/agencies/beneficiaries under
the government. Section 82 of this Act shall submit to the President of the Senate of the
Philippines, the Speaker of the House of Representatives, the Senate
"Notwithstanding any provisions herein to the contrary, the incremental Committee on Finance and the House Committee on Appropriations a
revenues from the tobacco taxes under this Act shall be subject to detailed report on the expenditure of the amounts earmarked hereon
Section 3 of Republic Act No. 7171, otherwise known as ‘An Act to copy furnished the Chairpersons of the Committee on Ways and Means
Promote the Development of the Farmer in the Virginia Tobacco of both Houses of Congress. The report shall likewise be posted on the
Producing Provinces’, and Section 8 of Republic Act No. 8240, otherwise official website of the agencies concerned.
known as ‘An Act Amending Sections 138, 139, 140 and 142 of the
National Internal Revenue Code, as Amended, and for Other Purposes’. Section 84. Implementing Rules and Regulations. - Within thirty (30) days
from the effectivity of this Act, the Secretary of Finance shall. upon the
"An interagency committee, chaired by the Department of Budget and recommendation of the Commissioner of Internal Revenue, promulgate
Management (DBM) and co-chaired by DOF and DSWD, and comprised the necessary rules and regulations for its effective implementation.
of the National Economic and Development Authority (NEDA),
Department of Transportation (DOTr), Department of Education Section 85. Separability Clause. - If any provision of this Act is
(DepEd), Department of Health (DOH), Department of Labor and subsequently declared invalid or unconstitutional, the other provisions
Employment (DOLE), National Housing Authority (NHA), Sugar hereof which are n~t affected thereby shall remain in full force and
Regulatory Administration (SRA), Department of the Interior and Local effect.
Government (DILG), Department of Energy (DOE), NFA, and TESDA, is
hereby created to oversee the identification of qualified beneficiaries Section 86. Repealing Clause. - The following laws or provisions of laws
and the implementation of these projects and programs: Provided, That are hereby repealed and the persons and/or transactions affected
qualified beneficiaries under Subsection (c) hereof shall be identified herein are made subject to the VAT provision of Title IV of the NIRC, as
using the National ID System which may be enacted by Congress. amended:

"Within sixty (60) days from the end of the three (3)-year period from (a) Section 3 of Presidential Decree (P.D.). 1972, s. 1985, as
the effectivity of this Act, the interagency committee and respective amended, Sections 4 and 5 of Executive Order No. (E.O.) 1057,
implementing agencies for the above programs shall submit s. 1985, and Section 4 of E.O. 1064, s. 1985, insofar as the VAT
corresponding program assessments to the COCCTRP. The National tax exemption and tax credit is concerned;
Expenditure Program from 2019 onwards shall provide line items that
correspond to the allocations mandated in the provisions above. (b) Section 10, insofar as VAT exemption is concerned, of
Republic Act No. (R.A.) 6807 or An Act Converting the Mati
"At the end of five (5) years from the effectivity of this Act, all Community College into a State College to be known as the
earmarking provisions under Subsection (F), shall cease to exist and all Davao Oriental State College of Science and Technology,
incremental revenues derived under this Act shall accrue to the General Providing for a Charter for this Purpose, Expanding its Curricular
Fund of the government."
 52

Offerings, Redirecting its Objectives, and Appropriating Funds Ak1an State College of Agriculture, and Appropriating Funds
Therefor; Therefor;

(c) Sections 18 and 19, insofar as VAT exemption is concerned, (k) Section 12, second sentence, insofar as VAT exemption is
of R.A. 6847 or The Philippine Sports Commission Act; concerned, of R.A. 7373 or An Act Establishing the Eastern
Visayas Science High School;
(d) Section 8(d), last paragraph, insofar as VAT exemption is
concerned, of R.A. 7278 or An Act Amending Commonwealth (l) Section 11(j), insofar as VAT exemption is concerned, of R.A.
Act No. 111, as Amended by P.D. 460, entitled An Act to Create 7605 or the Charter of the Philippine State College of
a Public Corporation to be Known as the Boy Scouts of the Aeronautics;
Philippines, and to Define its Powers and Purposes, by
Strengthening the Volunteer and Democratic Character of the (m) Section 126, insofar as VAT exemption is concerned, of R.A.
Boy Scouts of the Philippines and for Other Purposes; 7653 or The New Central Bank Act;

(e) Section 1, insofar as VAT exemption is concerned, of R.A. (n) Section 14, insofar as VAT exemption is concerned, of R.A.
7291 or An Act Restoring the Tax and Duty Incentives Previously 7875 or the National Health Insurance Act of 1995;
Enjoyed by the Veterans Federation of the Philippines under
Republic Act Numbered Twenty-Six Hundred and Forty; (o) Section 18, insofar as VAT exemption is concerned, and
Section 18, last paragraph of R.A. 7884 or the National Dairy
(f) Section 21, insofar as VAT exemption is concerned, of R.A. Development Act of 1995;
7306 or the Charter of the People’s Television Network, Inc.;
(p) Section 8, insofar as VAT exemption is concerned, R.A. 8160
(g) Section 14, insofar as VAT exemption is concerned, of R.A. or An Act Granting the University of the Philippines a Franchise
7354 or the Postal Service Act of 1992; to Construct, Install, Operate and Maintain for Educational and
Other Related Purposes, Radio and Television Broadcasting
(h) Section 9(c), insofar as VAT exemption is concerned, of R.A. Stations Within the University of the Philippines and in Such
7355 or the Manlilikha ng Bayan Act; Other Areas Within the Scope of its Operation;

(i) Section 21, insofar as VAT exemption is concerned. of RA (q) Sections 2 and 16, insofar as VAT exemption is concerned, of
7366 or the Law Creating the National Commission for Culture R.A. 8282 or The Social Security Act of 1997;
and the Arts;
(r) Section 39, insofar as VAT exemption is concerned, of R.A.
(j) Section 7(f), insofar as VAT exemption is concerned, of R.A. 8291 or The Government Service Insurance System Act of 1997;
7371 or An Act Converting the Aklan Agricultural College into
 53

(s) Section 4(c) and (f), insofar as VAT exemption is concerned, College into State College to be known as the Negros
of R.A. 8292 or the Higher Education Modernization Act of Occidental Agricultural College;
1997;
(bb) Section 16, insofar as VAT exemption is concerned, of R.A.
(t) Section 25, insofar as VAT exemption is concerned, of R.A. 9497 or The Civil Aviation Authority Act of 2008;
8492 or the National Museum Act of 1998;
(cc) Section 25(b) and (c), insofar as VAT exemption is
(u) Section 3(h), insofar as VAT exemption is concerned, of R.A. concerned, and (d), insofar as VAT zero rating is concerned, of
8502 or the Jewelry Industry Development Act of 1998; R.A. 9500 or the University of the Philippines Charter of 2008;

(v) Article 65, insofar as VAT exemption and zero rating is (dd) Section 25(b) and (c), insofar as VAT exemption is
concerned, of regional or area headquarters and zero-rating of concerned, and (d) insofar as VAT zero-rating is concerned, of
the sale or lease of goods and property and the rendition of R.A. 9519 or An Act Converting Mindanao Polytechnic State
services to regional or area headquarters, and Article 67, College into a State University to be Known as the Mindanao
insofar as VAT exemption is concerned, of R.A. University of Science and Technology;
8756; Provided, That existing RHQs and ROHQs enjoying VAT
exemption and zero-rating at the time of the effectivity of (ee) Section 17(c), insofar as VAT exemption is concerned, of
TRAIN shall not be affected; R.A. 3591, otherwise known as the PDIC Charter, as amended
by Section 8 of R.A. 9576, otherwise known as An Act Increasing
(w) Section 7(c), insofar as VAT exemption is concerned, of R.A. the Maximum Deposit Insurance Coverage, and in Connection
9045 or An Act Creating the Batangas State University; Therewith, to Strengthen the Regulatory and Administrative
Authority, and Financial Capability of the Philippine Deposit
(x) Section 7(c), insofar as VAT exemption is concerned, of R.A. Insurance Corporation (PDIC), Amending for this Purpose
9055 or An Act Converting the A1tlan State College of Republic Act Numbered Three Thousand Five Hundred Ninety-
Agriculture into the Aldan State University; One, as Amended, Otherwise Known as the PDIC Charter, and
for Other Purposes;
(y) Section 13, insofar as VAT exemption is concerned of R.A.
9083 or An Act Establishing the Sta. Rosa Science and (ff) Sections 2 and 19, insofar as VAT exemption is concerned,
Technology High School in Sta. Rosa Laguna; of R.A. 9679 or An Act Further Strengthening the Home
Development Mutual Fund, and for Other Purposes;
(z) Section 7(c) and (f), insofar as VAT exemption is concerned,
of RA 9138 or An Act Establishing the Guimaras State College; (gg) Section 23, insofar as VAT exemption is concerned of the
National Historical Commission of the Philippines, of R.A.
(aa) Section 7(c), insofar as VAT exemption is concerned, of R.A. 10086, or the Strengthening Peoples’ Nationalism Through
9141 or An Act Converting the Negros Occidental Agricultural Philippine History Act;
 54

(hh) Section 7(b) and (c), insofar as VAT exemption is (rr) Section 10, with respect to VAT, of R.A. 7718 or An Act
concerned, and (d), insofar as VAT zero-rating is concerned, of Amending R.A. No. 6957;
R.A. 9647 or the Philippine Normal University Modernization
Act of 2009; (ss) Section 26(B)(3), with respect to VAT, of R.A. 9275 or the
Philippine Clean Water Act of 2004;
(ii) Section 17, insofar as VAT exemption is concerned, of R.A.
7898, as amended by R.A. 10349, Establishing the Revised AFP (tt) Section 20(d)(3) of R.A. 7279 or the Urban Development
Modernization Program and for Other Purposes; and Housing Act of 1992;

(jj) Section 56, insofar as VAT exemption is concerned, of R.A. (uu) Section 20(d)(3) of R.A. 10884 or An Act Strengthening the
10801 or the Overseas Workers Welfare Administration Act; Balanced Housing Development Program, Amending for the
Purpose RA 7279, as Amended, Otherwise Known as the Urban
(kk) Section 9(e)(2) and (j), with respect to VAT, of R.A. 7900 or Development and Housing Act of 1992;
the High-Value Crops Development Act of 1995;
(vv) Section 14, with respect to VAT, of R.A. 8423 or the
(ll) Section 24(e) of R.A. 10068 or the Organic Agriculture Act of Traditional and Alternative Medicine Act (TAMA) of 1997;
2010;
(ww) Section 22(b) of R.A. 10747 or the Rare Diseases of the
(mm) Section 14(b), with respect to VAT, R.A. 7308 or the Seed Philippines;
Industry Development Act of 1992;
(xx) Section 45(a), (b), and (c), with respect to VAT, of R.A. 9003
(nn) Section 35 (b)(c), with respect to VAT, of R.A. 8550 or The or the Ecological Solid Waste Management Act of 2000;
Philippine Fisheries Code of 1998;
(yy) Section 5(b), with respect to VAT, of R.A. 10771 or the
(oo) Section 13, second paragraph, with respect to VAT, of R.A. Philippine Green Jobs Act of 2016;
10817 or the Philippine Halal Export Development and
Promotion Act of 2016; (zz) Section 6, with respect to VAT, of R.A. 7459 or the Investors
and Inventions Incentives Act of the Philippines;
(pp) Section 9(3), (4), and (8), with respect to VAT, of R.A. 8479
or the Downstream Oil Industry Deregulation Act of 1998; (aaa) Section 24, insofar as VAT exemption of foundations for
scientific advancements is concerned, of R.A. 2067, as
(qq) Section 6(c) and (d), with respect to VAT, of R.A. 7103 or amended, or the Science Act of 1958; and
the Iron and Steel Industry Act;
(bbb) Section 9, with respect to VAT, of R.A. 9511 or the
National Grid Corporation of the Philippines Act.
 55

Provided, That the VAT obligations of government owned and-controlled government securities for the purposes of penalizing forgery or
corporations, state universities and colleges, and other government alteration."
instrumentalities whose VAT exemption has been repealed under this
Act shall be chargeable to the Tax Expenditure Fund (TEF) provided for (d) Section 5 of R.A. 8756 or An Act Providing for the Terms,
in the annual General Appropriations Act: Provided, further, That VAT Conditions and Licensing Requirements of Regional or Area
exemption, VAT zero-rating, and VAT credit granted to state universities Headquarters, Regional Operating Headquarters, and Regional
and colleges on their purchases and importations are hereby repealed Warehouses of Multinational Companies, An;tending for the
and the transactions affected herein are made subject to the VAT Purpose Certain Provisions of Executive Order No. 226 or The
provisions of Title IV of the NIRC, as amended. Omnibus Investments Code of 1987: Provided, That existing
Regional or Area Headquarters, Regional Operating
Provided, That, with respect to income tax, the following laws or Headquarters, and Regional Warehouses of Multinational
provisions of laws are hereby repealed or amended: Companies enjoying the preferential income tax rate at the
time of the effectivity of the TRAIN shall not be affected;
(a) Section 33(A) of R.A. 7277, as amended by R.A. 10754 or the
Magna Carta for Persons with Disability; (e) Section 2 of P.D. 1354, s. 1978 or Imposing Final Income Tax
on Subcontractors and Alien Employees of Service Contractors
(b) Section 22(B) of R.A. 10165 or the Foster Care Act of 2012; and Subcontractors Engaged in Petroleum Operations in the
Philippines under Presidential Decree No. 87: Provided, That
(c) Section 4 of R.A. 1169 or An Act Providing for Charity service contractors and subcontractors enjoying the
Sweepstakes, Horse Races and Lotteries: preferential income tax rate at the time of the effectivity of the
TRAIN shall not be affected; and
"Sec. 4. Holding of sweepstakes.— The Office shall bold charity
horse race sweepstakes under such regulations as shall be (f) Section 7 of P.D. 1034, s. 1976, or Authorizing the
promulgated by the Board in accordance with Republic Act Establishment of an Offshore Banking System in the
Numbered Three hundred and nine: Provided, however, That Philippines: Provided, That service contractors and
when the holding of a sweepstakes race to determine prizes is subcontractors enjoying the preferential income tax rate at the
impossible due to war, public calamity, or other unforeseen or time of the effectivity of the TRAIN shall not be affected.
fortuitous event or when there is no sufficient number of
horses to determine the major prizes, the Board of Directors Section 87. Effectivity. - This Act shall take effect on January 1, 2018
may determine the procedure to be followed in the distribution following its complete publication in the Official Gazette or in at least
of prizes in the most just, equitable and expeditious manner. one (1) newspaper of general circulation.
The horse races and the sale of tickets in the said sweepstakes
shall be exempt from all taxes, except that each ticket shall bear
a twelve-centavo internal revenue stamp. The tickets shall be
printed by the Government and shall be considered